Preamble

The House met at half-past Two o'clock

PRAYERS

[MADAM SPEAKER in the Chair]

Oral Answers to Questions — SOCIAL SECURITY

The Secretary of State was asked—

Disability Living Allowance

Mr. Elfyn Llwyd: How many applications for disability living allowance are currently under review or appeal; what was the corresponding figure 12 months ago; and if he will make a statement. [58366]

The Minister of State, Department of Social Security (Mr. John Denham): Last year at 31 October, there were 70,181 requests for a review of disability living allowance decisions in hand and 36,895 appeals. The corresponding figures for 31 October this year are 57,035 reviews and 36,011 appeals.

Mr. Llwyd: I now have several—in fact dozens—of constituents whose cases have been turned down, seemingly for no good reason. One person who is blind has been turned down, and an amputee who has also lost the use of an arm and has terrible vertebra problems has been turned down and deemed fit for work. How does all that square with the platitudes we heard last week about helping the disabled back to work? Is it not absolute nonsense and a disgrace?

Mr. Denham: It is essential that we get decisions on disability living allowance right in the first instance and that we take action to ensure that decisions remain correct. As a result of the benefit integrity project, we have changed our procedures to ensure that cases can be reviewed, with additional evidence if necessary. We shall continue to improve the process so as to ensure that the right benefit is paid to the right people. As the hon. Gentleman knows, we recently announced that, in due course, we wish to replace the benefit integrity project with a fair and sensitive system for ensuring that DLA cases are correct.

Dr. Norman A. Godman: I welcome my hon. Friend's promise of a fairer system, because the current criteria are not so much stringent as appallingly harsh. Can he do something to reduce the waiting time for appeals to be heard? Nothing seems to have changed in that respect, which is deeply unfair to

constituents who have burdens enough to shoulder without having to endure a long wait for an appeal hearing.

Mr. Denham: My hon. Friend makes some important points. The gateways to DLA can be confusing, both to claimants and to those who are adjudicating the claims. That is why we are consulting on the nature of those gateways. I entirely accept that the length of waiting time for appeals is not acceptable. Following the Social Security Act 1998, we are bringing into play new procedures to speed up the system for appeals and we shall work hard to achieve that end.

Miss Julie Kirkbride: The Minister mentioned the benefit integrity project. A short while ago, we were told that that project was due to come to an end, which created in the newspapers the impression that the Government wanted to create, which is that it will come to an end in the immediate future. However, the fine text shows that that is not the case, for there is no due date for the end of the benefit integrity project—I dare say that some Labour Members will be rather shocked to hear that. Will the Minister tell us when the benefit integrity project is to come to an end and what is to be put in its place? Can we have a date, please?

Mr. Denham: It was, of course, the Conservative Government who initiated the benefit integrity project. We are keen to introduce the change as soon as possible, but it is important that we get it right. The benefit integrity project will continue until it is replaced by a new system—one which we shall ensure is both fair and sensitive. My right hon. Friend the Secretary of State made it clear on 28 October 1998 that there would be no return to the situation that existed before April 1997, when nothing was being done to check that people were receiving the right benefit. The characteristics of the new system and when and how it will be introduced will be the subject of future discussions with the disability benefits forum.

Lone Parents

Mr. Tony McNulty: If he will make a statement on progress on the new deal for lone parents. [58367]

Laura Moffatt: What assessment he has made of progress on the new deal for lone parents. [58372]

Mr. Andrew Miller: What progress has been made in helping lone parents to move into work. [58381]

Mr. Shaun Woodward: If he will make a statement on the progress of the new deal for lone parents. [58384]

The Secretary of State for Social Security (Mr. Alistair Darling): The new deal for lone parents, which became available nationwide on 26 October, for the first time offers all lone parents on income support a personal adviser service to help them to overcome the barriers to employment. Nine out of 10 lone parents who


attended an interview agreed to participate in the programme, and more than a quarter of those have moved into work.

Mr. McNulty: Will my right hon. Friend give an assurance that all the key lessons of the pilot schemes for the new deal for lone parents will be learnt and incorporated into the national programme as it unfolds? Will he ignore the whingeing and carping of Conservative Members, who when they were in power, did absolutely nothing for lone parents?

Mr. Darling: My hon. Friend is right. The new deal in general, and that for lone parents in particular, represents a major cultural change in the actions of the Department for Education and Employment and the Government. It was wrong to leave a growing number of lone parents out of the labour market when many could be substantially better off in work. The working families tax credit, which we shall introduce next year, will ensure that every working family is guaranteed an income for full-time work of at least £190 a week, but the Conservative party wants to scrap that measure.

Laura Moffatt: Does my right hon. Friend agree with me and Gemma, a lone parent adviser in my constituency, that lone parents have enthusiastically embraced the chance to go back to work? Does he agree also that immediate work may not be the only outcome and that lone parents understand that before they can embrace the world of work, training might be necessary, and that is what they are undertaking?

Mr. Darling: Again, my hon. Friend is right. Although Conservative Members may snigger, nine out of 10 lone parents who came for an interview joined the new deal. Some went into work and others needed to upgrade their qualifications, but the Conservative party would scrap the entire new deal and leave every one of those people high and dry. That is not the right approach for modem labour market conditions.

Mr. Miller: I am sure that my right hon. Friend will agree that many of the failings of changes in the social security system under the previous Administration resulted from an appallingly bad level of training. Will he assure the House that when the scheme is implemented, proper training systems will be put in place?

Mr. Darling: Yes. It is very important that advisers are properly trained and skilled because often they are dealing with people who have difficult circumstances at home, perhaps because they do not have support and help to look after young children. It is important also to ensure that everybody realises the benefits that will come from the new deal, not least the fact that the Government's national child care strategy is now being fully rolled out to ensure that people have child care. The working families tax credit, in addition to ensuring that families in full-time work get at least £190 a week, provides significant help towards child care, which can be a major barrier that in the past has prevented lone parents from going into work.

Mr. Woodward: The Secretary of State will know that only 50,000 people have been invited to participate in the scheme, but the Department of Social Security's own

research statistics reveal that only 2 per cent. have left income support. Does he agree that the scheme does not work? Will he think again, find a better scheme and tell the House the true cost, based on those who have left income support, of this scheme?

Mr. Darling: The hon. Gentleman will be aware that the pilot stage of the scheme has just ended and the national scheme was announced at the end of last month. I do not agree with his central premise. This country has a larger proportion of lone parents out of work than any other major European comparator country. The Government have a clear duty to encourage those who want to work to do so and to give them the opportunities that they were denied under the previous Government, which the hon. Gentleman supported. In this day and age the Government cannot stand by and watch an increasing number of people and their children be excluded from mainstream life—we would not be prepared to endorse that approach.

Mr. David Rendel: Does the Secretary of State agree that when the Government tell people that they will punish them if they do not do something, that will tend to make them feel that the act is for the Government's benefit, not for theirs? Does he therefore accept that the introduction of compulsion into the new deal will not help him make progress with it?

Mr. Darling: Of course the new deal does not contain an element of compulsion. We have always made it absolutely clear that for perfectly good reasons no one will compel a lone parent to go into work. The hon. Gentleman may be referring to a different programme—the new single gateway into the benefits system for people of working age. The Government clearly have a duty to do everything that they can to help people to get into work. In turn, everybody who comes into the benefits system should at the very least be prepared to sit down and find out what is on offer.
The history of the past 10 to 15 years shows that if people stay outside the labour market for too long, they tend to stay out indefinitely, and no responsible Government can put up with that. I hope that instead of complaining about matters, the hon. Gentleman and his party whole-heartedly endorse our approach because getting people into work must be the right way to deal with the problems that we have inherited. I am glad that the hon. Gentleman agrees with that.

Miss Anne McIntosh: On a point of order, Madam Speaker.

Madam Speaker: There is no point of order. We are in the middle of questions.

Mr. Frank Field: I agree very much with my right hon. Friend's comments about extending opportunities to those outside the labour market who are coming on to benefit for the first time. Is he in a position to tell us what penalty will apply to those who do not turn up for their interview?

Mr. Darling: As I told my right hon. Friend when I made my statement a short time ago, we believe that it is


right that people who enter the system through the single gateway, when the system is fully operational, should be required to attend an interview as a condition of benefit.

Miss McIntosh: I am most grateful, Madam Speaker. Does the right hon. Gentleman agree with his noble Friend Baroness Hollis who announced that sanctions will be put in place if a lone parent fails to attend the initial interview for the new deal for lone parents? If that is so, can he explain today exactly what form those sanctions will take? For how long will the sanctions apply? Will they apply only to child benefit or will the lone parent lose all benefits to which he or she would otherwise have been entitled?

Mr. Darling: I apologise to the hon. Lady. I was not clear why she was gesticulating at me a few moments ago. I understand that perhaps her question should have been grouped and, if that is my fault, I apologise.

Madam Speaker: It should not have been grouped. I expected to reach question No. 17, but it will now be withdrawn because I have called the hon. Lady.

Mr. Darling: I appreciate that, Madam Speaker. As to the hon. Lady's question, there is no compulsion in the new deal—as I have made clear. We are talking about the single gateway into the benefit system. That programme will be piloted over the next two to three years before it becomes a national scheme. When the single gateway is operational, it will be a condition of receiving benefit that people agree to attend an interview.

Disabled Children

Mr. Jim Dobbin: What progress he is making in improving support for disabled children. [58368]

The Parliamentary Under-Secretary of State for Social Security (Mr. Stephen Timms): In our consultation document on support for disabled people, we announced two particular proposals that will help the families of disabled children: first, the disability income guarantee, which is based on a new premium and income-related benefits for families with disabled children with the greatest care needs; and, secondly, the extension of the higher rate mobility component of disability living allowance to children aged three and four for whom claims have not been accepted in the past.

Mr. Dobbin: While I support and welcome the Government's intention to extend the disability living allowance higher rate mobility component to three and four-year-olds and I support also the Government's commitment to protecting the poorer members of society, can the Minister assure me that those disability groups will be part of a real and proper consultation process so that they will be able to shape the legislation?

Mr. Timms: I am grateful for my hon. Friend's support, and I can give him the assurance that he seeks. The disability benefits forum met last week and considered in detail the proposals in our consultation document. It will meet again next week and there will be a series of discussions with the disability organisations

to which my hon. Friend referred about how to take the proposals forward. The proposals have been widely welcomed. They are a clear example of our resolve to re-focus the benefit system in order to provide additional help for those who need it most.

Family Credit

Mr. Julian Brazier: If he will make a statement on the number of families who are currently eligible for family credit. [58369]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): In May 1998, 767,000 families were receiving family credit, which is 72 per cent. of those eligible but 84 per cent. of the maximum take-up if measured by expenditure.

Mr. Brazier: Can the Minister confirm that the programme currently costs about £3.5 billion, which is £1.5 billion less than the projected cost of the working families tax credit that should replace it? On what assumptions on employment is that projection of substantial increased cost based? Is it assumed that there will be a rise in such employment, or simply that the tax credit will reach much further up the income scale?

Angela Eagle: The working families tax credit, which will replace family credit in October 1999, is more generous. That is why it will cost £5 billion instead of the current cost of family credit. That will mean that it makes work pay for 400,000 more low-paid families.

Mr. Steve Webb: Does the Minister accept that one of the great strengths of family credit is the fact that it copes well at the time of relationship breakdown, in that, typically, the money is paid to the mother in a couple, and therefore continues when the relationship breaks down? Does she accept that, when family credit is abolished and replaced by a benefit paid, typically, to the father in a couple, that will produce hardship for mothers and children at the time of relationship breakdown?

Angela Eagle: In fact, couples can choose who the working families tax credit will be paid to. The hon. Gentleman should also know that, in 50 per cent. of such families, the mother is the main breadwinner, so, generally, the benefit will be paid to her anyway. The hon. Gentleman is worrying overmuch about a system that is far more generous than is the existing system to those who are low-paid and want to work.

Mr. Bill Rammell: Does the Minister agree that one of the biggest problems with the current social security system is the fact that it places barriers in the way of people who want to work? Can she confirm that, under existing family credit regulations, people can be worse off if they work more hours, and can she confirm that that distortion will be removed by the working families tax credit? Will she reassure the House that the Government will progressively work, through the social security system, to ensure that such anomalies are ironed out once and for all?

Angela Eagle: I agree with my hon. Friend; he is exactly right. The working families tax credit has far more generous tapers in income than does family credit—down from 70 per cent. to 55 per cent—so the credit is withdrawn in a more generous way. It is also more generous in that it begins higher up the income scale, at £90 instead of £79 for family credit. It starts to tackle the unemployment traps, the benefit traps and the significant barriers to work that those who are on low pay or who may work part time currently face.

Mr. Iain Duncan Smith: The Minister has failed to answer the question asked by my hon. Friend the Member for Canterbury (Mr. Brazier). Every year, the Government will spend on working families tax credit £1.5 billion more than has been spent on family credit, and in doing so they will make a mess of many of the main features of family credit. The Minister still has not said that the Department of Social Security or the Treasury have figures to show by how much the working families tax credit will increase employment and how much the Government will save in the medium or long term as a result of introducing that tax credit. Will she give us the answer now? What is the saving? How many extra jobs?

Angela Eagle: The hon. Gentleman is against working families tax credit, and has said that he will abolish it. That will mean a tax increase for 1.5 million hard-working families of up to £17 a week.

Mr. Duncan Smith: The Minister has not answered the question. The question was, what forecast has the Department made? If the Department is saying that it is prepared to spend an extra £1.5 billion a year, it must be predicated on an assumption of a saving elsewhere or more jobs; which is it? Or is the answer, "It may do this or it may not"? We have heard of the green shoots, but now this seems to be a policy of "The Darling Buds of May".

Angela Eagle: I think that the green shoots of economic policy were spoken of by a Conservative Chancellor, not a Labour Chancellor. [Interruption.] If the hon. Gentleman will be quiet for a minute, I shall answer his question. The working families tax credit removes barriers to work and creates incentives for those who are on low pay to work. It is not intended to create more jobs. It is simply intended to make work pay for those people currently on benefit, who face levels of marginal deduction from benefit of considerably more than 100 per cent.—the legacy of the uncaring Conservative Government.

Disabled People

Mrs. Joan Humble: What proposals he has to improve work opportunities for disabled people. [58370]

Mr. Terry Rooney: What assessment he has made of the willingness of disabled people to move from welfare into work. [58373]

The Secretary of State for Social Security (Mr. Alistair Darling): We know that more than 1 million disabled people receiving state benefits want to work. Together with my right hon. Friend the Secretary of State for Education and Employment, we have introduced the new deal for disabled people and proposals for a single gateway. I have also proposed reform of the all-work test. These and other measures will greatly improve opportunities for disabled people.

Mrs. Humble: One of the main problems facing disabled people seeking work is that they fear that they may lose benefits if the job does not work out. Can my right hon. Friend give an assurance that the Government are taking action to make sure that the protection offered by the benefit system is not withdrawn as soon as a disabled person takes the risk and goes into work?

Mr. Darling: My hon. Friend raises an important point. Disabled people especially may be afraid to change their circumstances because in the past they believed that that would be to their disadvantage. Not only do we have advisers under the new deal who will give advice, but the 12-month linking rule will ensure that someone coming off benefit and going into work will be protected. However, I notice with deep regret that the Conservative party is opposing that rule. The disabled persons tax credit will also provide a guaranteed minimum income, in the same way as the working families tax credit. The Conservatives are against that as well. We are introducing other practical measures that will help to reduce the barriers that face many disabled people going into work. Our objective is to ensure that as many people who are disabled and who want to work can do so.

Mr. Rooney: The Secretary of State will be aware that many Labour Members have campaigned for many years for the right of disabled people to work. Will he confirm the amount of money that will be available under the new deal for people with disabilities, and how many people he expects to be placed in work through it?

Mr. Darling: My hon. Friend will know that £195 million is being spent on the new deal. The disabled persons tax credit, as I explained earlier, will mean that many disabled people will be substantially better off in work. That will operate together with other practical forms of help, some of which were announced a couple of weeks ago, such as the job introduction scheme, the disability rights commission and the supported employment programme.
Right across the board, we are doing everything that we can to make it easier for people with a disability to get into work and to stay in work. We are also, of course, encouraging employers to do everything that they can to keep people in work, rather than letting them go when a problem arises. The Government are committed to improving the situation that faces disabled people, and it is a matter of deep regret that many of the practical measures that we are introducing are bitterly opposed by the Conservative party.

Sir Peter Tapsell: Everyone will support and encourage schemes for getting disabled people who are able to work back into work. However, like the hon. Member for Meirionnydd Nant Conwy


(Mr. Llwyd), I have encountered in my constituency recently a number of cases of people who have been on disability living allowance for a considerable time, from whom that has been withdrawn under the new criteria, and who have been told that they are fit to go back to work. I interviewed them myself as a layman, and it is obvious to me that they are not fit to go back to work. Will the right hon. Gentleman look at the criteria again and make sure that they are not too harsh?

Mr. Darling: I shall try to deal with the points that the hon. Gentleman makes. First, disability living allowance is not an out-of-work benefit. It is designed to provide help with extra costs, whether someone is working or not. Secondly, no new criteria have been introduced. The benefit integrity project, which the hon. Gentleman will no doubt recall was introduced in the dying days of the previous Government, resulted in a number of people being excluded from benefit who probably should not have been excluded. That is why I want to replace that scheme with a fairer and better scheme that ensures that we get benefit right first time and avoid the situation that we inherited, where a third of people receiving DLA have no medical evidence to back up that award. The benefits system that we inherited, as the hon. Gentleman should know, left an awful lot to be desired. Our objective is to improve it.
Finally, the hon. Gentleman says that everybody would support measures to help people to get back into work. He had better have a word with those on his Front Bench, who are opposing measures that will come before the House tomorrow to institute the 12-month linking rule, which will be of great advantage to people with disabilities.

Mr. Mark Oaten: Can the Secretary of State tell the House how many jobs he believes will be created from the £195 million under the pilot scheme for the new deal? Has the Department thought beyond that and recognised that billions, not millions, of pounds will be needed to tackle the 1 million disabled people who are able and want to get back to work?

Mr. Darling: The hon. Gentleman misses the point. The new deal is not a job creation programme of the sort that we have seen in the past. Its object is to ensure that people are equipped and have the skills to get work. Many disabled people face additional barriers that others do not face. The point of the new deal and the other measures that we are introducing is to ensure that the disadvantages that have been visited upon disabled people are removed. I should have thought that he would do better supporting that proposition, rather than carping at its objectives.

Mr. Malcolm Wicks: Given that people with very serious physical disabilities and learning difficulties are enabled to find employment through supportive employment projects, will my right hon. Friend comment on the fact that there are not enough places and resources for such projects and, therefore, resources are spent on social security for people with disabilities who want to be in work? Is there scope for usefully transferring resources from my right hon. Friend's Department to the Department of Education and Employment so that we can have sensible social policy in this area?

Mr. Darling: My hon. Friend will know that both I and my right hon. Friend the Secretary of State for

Education and Employment are constantly examining ways in which we can ensure that people are in work and not on benefit. Our objective is to ensure that the bills that we have to meet because people are out of work who could be in work are reduced. We have taken considerable steps so far and we shall have further announcements to make. The supportive employment programme is primarily a matter for my right hon. Friend the Secretary of State for Education and Employment rather than for my Department.

Mrs. Theresa May: The Secretary of State failed to answer the questions asked by the hon. Members for Bradford, North (Mr. Rooney) and for Winchester (Mr. Oaten). I suggest that they might care to read Hansard, where they will find that although the Government keep quoting that 1 million disabled people want to get into work, the figures for the projects that have been initiated by the Government suggest that the number of disabled people being helped into work by these projects is fewer than 20,000. Meanwhile the Government are changing the rules for incapacity benefit for those out of work because of their disability.
Will the Secretary of State confirm that in a full year 170,000 disabled people who now would qualify for incapacity benefit will, as a result of the Government's changes, be denied that benefit? Is this not just a callous attempt to redefine people off benefit to cover up the fact that the Government have failed to deliver real welfare reform?

Mr. Darling: I shall deal with the two points that the hon. Lady makes. First, on incapacity benefit, she must know that during the past 18 years when the Conservative party was in power it cynically used the incapacity benefit system to get people off the official unemployment figures and move them into statistics which received less attention.
The previous Government systematically went about trying to undermine the system that had been in place to ensure that help was there for people who were in work and became disabled. Incapacity benefit was never intended as an early retirement scheme, which is what the previous Government intended for it. If welfare reform means anything it must mean modernising the benefit system to ensure that benefits go to those who are entitled to them and to those for whom they were intended. That certainly did not happen under the previous Government.
Secondly, the hon. Lady asks about the working families tax credit and the new deal. The Conservative party is against both measures. It is against any measures that are designed to help people who have been excluded from the labour market. I remind the hon. Lady that at present there are about 200,000 vacancies notified in job centres and that some disabled people could go into them. The object of our reforms is to ensure that some of these vacancies can be filled by those who have disabilities. Unfortunately all these measures are opposed by the Conservative party.

Housing Benefit

Mr. Dale Campbell-Savours: What proposals he has for the future of housing benefit. [58371]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): We are taking forward a wide-ranging review of housing benefit in consultation with local authorities and other interested parties. This review will aim to simplify and improve both the benefit itself and the way in which it is delivered. In addition, my right hon. Friend the Chancellor has announced an improvement to the extended payments scheme to make the transition into work easier for housing benefit claimants who are unemployed.

Mr. Campbell-Savours: What is the Government's estimate of the cost to the taxpayer of landlord fraud perpetrated on the housing benefit system? Can my hon. Friend tell us how many landlords have been successfully prosecuted for such fraud?

Angela Eagle: The Government's estimates of the extent of landlord fraud range from £100 million to £150 million. Unfortunately, we do not collect figures for fraud prosecutions by type, so I cannot answer my hon. Friend's second inquiry.

Mr. Quentin Davies: Following the revelations of the right hon. Member for Birkenhead (Mr. Field), is it not an open secret that when decisions are eventually taken on this matter—or, more likely, when the Government definitively run away from them—as with all the other decisions on which we are waiting for them to pronounce, such as welfare reform and pensions, they are determined not by the Department of Social Security but by the Treasury and the No. 10 policy unit? Will the right hon. Gentleman answer a simple and, for him, fundamental question: if the Benefits Agency and, in the case of housing benefit, local authorities, have the job of handing out the money, and if policy decisions in Whitehall are taken by the Treasury or No. 10, what is the point of having a DSS at all?

Angela Eagle: First, I should like to point out that I am an hon. Lady, not an hon. Gentleman—in case the hon. Gentleman did not know.
The simplification project that we are carrying out with local authorities is seriously intended to make housing benefit simpler to administer and easier to understand. Delays and complexities in housing benefit are major barriers that prevent people from entering work, and we are determined to tackle them.

Child Support Agency

Helen Jackson: How many outstanding cases are presently with the Child Support Agency waiting to be closed where the child concerned is of employable age.[58374]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): A parent with care is required to notify the Child Support Agency if a child stops receiving full-time education. Because those changes are recorded only when the assessment is reviewed, it is not possible to say how many cases are waiting to be closed.

Helen Jackson: I was always struck by the promptness and efficiency of the family allowance system, because

the week my children left school and ceased to be dependent, my family allowance stopped. Why cannot the Child Support Agency be as efficient when dependants for whom people pay out of their earnings reach independence? People often find themselves paying deductions from earnings orders for six months or more after that threshold. Is that not another symptom of the gross inefficiency of the CSA, which has come to epitomise the muddle and incompetence of the former Administration that set it up?

Angela Eagle: I have considerable sympathy with my hon. Friend's point. Believe it or not, as part of the Tory legacy that we inherited, the child benefit computer system cannot talk to the child support computer system and identify when the children whom it was set up to support have reached a certain age. We are doing all that we can to remedy that, and will be in a position to identify that fact manually by next year. As part of the ACCORD computer procurement project announced recently, we hope to put that right permanently.

Mr. Tony Baldry: Neither the previous question nor the answer were fair. Unlike family allowance, child support does not finish when a child reaches employable age. An absent parent has always provided support while a child is in full-time education or training, which is why child support will always be a much more complex benefit. There will always be circumstances in which teenagers will go on to full-time education or training, and they should be supported by the absent parent if he or she is in a position to support them.

Angela Eagle: Child support is bound to be more complex than child benefit, but the system should not have been as complex as the Conservative Government made it when they introduced it. The hon. Gentleman is right to say that child support does not automatically stop at the age of 16. However, there remains the issue of whether, once education is finished, whatever the child's age, child support is still payable. If those computer systems could talk to each other, at least a prompt would be given so that members of the CSA could check with the parent with care to see whether those circumstances had changed. At present, the parent with care has to notify the CSA to get changes made. Inevitably, that takes time and some people forget to do it.

Helen Jones: What action his Department has taken to improve the support for children provided by the benefits system. [58375]

The Secretary of State for Social Security (Mr. Alistair Darling): We have increased the premium for children under 11 on income-related benefits from this November and we are also increasing child benefit by a record amount from April next year.

Helen Jones: I thank my right hon. Friend for that reply. I represent a constituency containing some of the most deprived wards of north Cheshire, which have a high proportion of lone parents. In one ward, nearly a quarter of children are in lone-parent families. Can he assure the House that they, too, will share in any increases in benefits and that we will set out to tackle the poverty which undoubtedly exists in such families?

Mr. Darling: My hon. Friend will know that the Chancellor took a deliberate decision in his previous Budget to ensure that not only child benefit, but the premiums paid for those in receipt of income-related benefits would be increased. The help that we are giving through the new deal for lone parents and the introduction of the working families tax credit—both of which are opposed by the Conservatives—will offer substantial assistance to the very people to whom my hon. Friend has referred. That is a far better use of public money than the proposal that the Conservative party has come up with today—to spend between £3 billion and £5 billion per annum on a transferable tax allowance. It would be far better to spend that money in a far more targeted way—to help people to get back into work as well as to help those on the lowest incomes.

Mr. Howard Flight: May I ask why a lone parent with the same income as a married couple with a single income will do considerably better under the working families tax credit? It cannot have been the Government's objective to discriminate deliberately against married couples and their children, but that is the way that the finances work out.

Mr. Darling: The Government's objective is to provide the maximum help that they can to all families—couples as well as lone parents. The working families tax credit is designed to make work pay for both types of family and to remove some of the barriers to work—the disincentives—under the scheme that we inherited. We believe that that is the best possible use of public money, because helping people into work and off benefit must and should be a central objective of any civilised Government.

Benefit Integrity Project

Mr. Austin Mitchell: How many people have been taken off benefit as a result of the benefit integrity project. [58376]

Mr. Robert Syms: If he will make a statement on the replacement for the benefit integrity project. [58378]

The Parliamentary Under-Secretary of State for Social Security (Mr. Stephen Timms): By 30 September, 138,000 cases had been checked under the benefit integrity project. Of those, 32,500 people were found initially not to be receiving the right amount of benefit. The number fell to 29,300, after the reviews and appeals that have been completed so far.
It is right to check whether people are receiving the correct rate of benefit, but the benefit integrity project, as conceived by the previous Government, was flawed in two specific respects. First, it was insensitive to the circumstances of disabled people—we have made a number of improvements—and, secondly, it focused only on people with high rates of disability living allowance so that payment changes could, in the great majority of cases, be downwards only.
That is why we plan to replace BIP with a new system—part of the routine administration of the benefit—which is sensitive to people's circumstances and

which is fair, because it will apply to all benefit rates and so result in upward, or downward, revisions to ensure that people are receiving the correct amount of benefit.

Mr. Mitchell: I thank my hon. Friend for that answer, with which I agree whole-heartedly. Can he tell us how soon the new system, which needs to be introduced urgently, will come in? Can he assure us that it will not include the coercive aspects of the benefit integrity project? They have clouded the debate on disablement and benefit with a fog of fear and alarm which is felt by those who think that they are being coerced and subjected to a shake down to get them off the benefit that they had received from the previous Administration. We should deal with fraud, but not at the expense of inducing terror among those people who are entitled to benefit.

Mr. Timms: We intend to learn from the many lessons of the BIP experience and to introduce the new system as soon as possible, but it is important that we get it right. We do not want to rush into a new system without properly planning for it. We want to ensure, for example, that staff are properly trained by the time that the new arrangements start. The disability benefits forum set up a working group last week to work with us to plan how those new arrangements should work. We will put them in place as soon as we can sensibly do so.

Mr. Syms: Following the announcement of the scrapping of the benefit integrity project, people who have been assessed or are about to be assessed are concerned that they will face the double jeopardy of being processed through a new system. As the hon. Member for Great Grimsby (Mr. Mitchell) said, it is important that we have a date and guidelines for the establishment of the new system, because there is great concern in the disabled community. I hope that the Minister will be a little more precise. Was the announcement of the new system an aspiration for the next century, or will it be implemented early next year?

Mr. Timms: No. We are in discussion with the disability benefits forum about the arrangements that will replace BIP. We are not yet able to say precisely when the new arrangements will start, but I reassure the hon. Gentleman's constituents that there will be no question of a double jeopardy as he described. The current arrangements will continue until we have a properly planned and worked-out system with which to replace them.

Mr. Eric Pickles: Does the hon. Gentleman not understand the contradiction in the assurances that he has just given to his Back-Bench Friends? He implied that the benefit integrity project will end some time in the next century. He also suggested that things will be a little easier. Sources close to the Secretary of State have said that the Government intend to save 25 per cent. of the benefits budget. The implication of that is straightforward: people currently on benefit—legitimately, not through fraud—will lose. The Secretary of State has suggested that, for some people, the medical evidence for granting disability living allowance is not immediately obvious. Will Ministers second-guess medical opinion? Will the Minister tell us who will lose?

Mr. Timms: That question contained a number of disconnected points. There is no truth in the hon. Gentleman's allegation about a 25 per cent. saving. It is important that the Department and claimants are confident that they are receiving the correct amount of benefit. The previous Government introduced the BIP programme, which was designed to move people from high to lower rates of benefit. That was wrong and unfair. We will introduce arrangements that are fair and apply to all levels of disability living allowance, so that we can be certain that people are receiving the amount of benefit to which they are entitled. That is right for them, for the Department, for the Government and for society. I hope that the hon. Gentleman will apologise on behalf of the Conservative party for the BIP scheme that he supported, and that he will support the new arrangements that we will put in place.

Family Credit

Mr. David Amess: What estimate he has made of the take-up rate for family credit for 1998–99. [58379]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): As I told the hon. Member for Canterbury (Mr. Brazier), family credit take-up, by case load, is estimated to be 72 per cent., but measured by levels of expenditure it is 84 per cent.

Mr. Amess: Will the extra £1.5 billion being spent on the working families tax credit introduce other families to dependency, including higher earners? Will the hon. Lady explain why, under the new system, it will be more financially advantageous to look after other people's children than to look after one's own?

Angela Eagle: To be honest, I do not understand why the Conservative party insists on thinking that a more generous tax credit, with lower tapers which create pathways into work for the lowest paid, increases dependency. Conservative Members have a bizarre view of the benefits system.

Disability Benefits

15. Mr. Ben Chapman: What medical training or advice is available to adjudication officers in the Benefits Agency and independent tribunal service members when establishing the eligibility of claimants for disability benefits. [58380]

The Parliamentary Under-Secretary of State for Social Security (Mr. Stephen Timms): There are separate arrangements for Benefits Agency adjudication officers and members of independent tribunals. Benefits Agency adjudication officers complete 12 weeks' technical training in adjudication, which, in the case of disability living allowance, includes sessions given by doctors about the effects of disabling conditions on a person's need for help with personal care and mobility. Once trained, they have access to the disability handbook, a new edition of which was published recently, and, formally and informally, to doctors working under contract to the Benefits Agency.
The Independent Tribunal Service provides members with training in disability awareness and relevant legislation. Of the three tribunal members, there is always one who is medically qualified and another who has professional or personal experience of the effects of disability.

Mr. Chapman: I thank my hon. Friend for that reply. However, in a recent case involving a constituent who was appealing against a reduction in disability living allowance, the appellant was told both that there was no point in proceeding with the appeal because the result was inevitable and that the ITS had no knowledge of his disability. Does not that suggest that, despite the training given, further training on medical matters and interpersonal skills is required? Indeed, the number of letters in my postbag about the ITS suggests that the training need may be greater still.

Mr. Timms: I know that my hon. Friend has been concerned about the case of his constituent, and has been pursuing it. If he remains dissatisfied and would like to write to me, I shall be glad to investigate. The judicial aspect of ITS is the responsibility of the Lord Chancellor's Department; we are introducing new arrangements for appeals in order to improve the service.

Mr. Edward Leigh: Does the Minister agree that the benefit integrity project has demonstrated the inadvisability of lifetime awards, and the necessity for proper medical examination in all cases in which benefits are awarded?

Mr. Timms: I agree with both points. We intend to introduce legislation to end the use of the term "lifetime award", which is a confusing and unfortunate feature of the system introduced by the previous Government. It has always been the case that, if people's benefit entitlement is reduced because of a change in their circumstances, the benefit is reduced. We will clarify that as soon as we can.
I also agree with the hon. Gentleman about the need for clear evidence to support all disability benefit claims.

Mrs. Maria Fyfe: Does my hon. Friend agree that a general practitioner who has long-standing experience of his patient's case, and knows the extent of that patient's disability, may feel very irritated if his judgment is cast aside following a brief examination by another doctor? Will my hon. Friend take that into account in his intended reform of the benefit integrity project?

Mr. Timms: In fact, information from a claimant's own GP can be used in the determination of benefit entitlement, and we intend that to continue.

Housing Benefit

Sir Geoffrey Johnson Smith: What plans he has to review housing benefit. [58386]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): As I told my hon. Friend the Member for Workington (Mr. Campbell-Savours) in


response to an earlier question, we are currently reviewing housing benefit with the aim of simplifying and improving its administration.

Sir Geoffrey Johnson Smith: I am well aware that that review is a review of legislation passed in 1990, but will it also take into account an anomaly known to hon. Members on both sides of the House? Poor council tenants are having to subsidise rent rebates for those who are even less well off. In those circumstances, it is little wonder that my local authority, Wealden district council, has incurred a £2 million bill to help them on their way—money that could be far better spent on investment in housing, repairs and maintenance and better facilities for the disabled.

Angela Eagle: I can confirm that the review is wide-ranging, and is examining a number of aspects of a benefit that is complex and difficult to deliver. Under the previous Government there was a massive shift from subsidy for bricks and mortar to subsidy for rent, via the housing benefit system. It is difficult even to think of reviewing housing benefit without taking housing policy into account: we must consider the two together.

Disabled Children

Ms Jackie Lawrence: If he will make a statement on the action he is proposing to take to support disabled children. [58387]

The Parliamentary Under-Secretary of State for Social Security (Mr. Stephen Timms): We have announced two proposals for significant improvements in support for disabled children: the disability income guarantee, and the extension of the higher-rate mobility component of disability living allowance to children aged three and four. Disabled children will also be among those who benefit from our package on child poverty, the £1.5 billion programme on working families tax credit and the £300 million project for the national child care strategy.

Ms Lawrence: I welcome the extension of the mobility component of DLA to disabled children aged three and four. Many families in my constituency will appreciate it. Can my hon. Friend also say whether families of those children will have access to the Motability scheme? I am sure that he will appreciate the tremendous difficulties with transport for such families.

Mr. Timms: I thank my hon. Friend for her support and for raising an important point. I can confirm the important point that the change will convey with it access to the Motability scheme. That scheme, which celebrates its 21st anniversary next month, can provide a vehicle, vehicle adaptations or an electric wheel chair. Recent research has shown that children as young as three and four can suffer if their mobility needs are not met. Our proposals will be an important step forward for those children and will allow their families access to Motability.

Disability Living Allowance

Mr. Nigel Evans: What representations he has received concerning disability living allowance reforms. [58390]

The Parliamentary Under-Secretary of State for Social Security (Mr. Stephen Timms): A list of more than 1,000 organisations and individuals who responded to the welfare reform Green Paper is in the House of Commons Library, most of them touching on disability issues. As we promised in the Green Paper, we have established a disability benefits forum, which has a working group dealing specifically with reforms to the disability living allowance. The Select Committee on Social Security also published a valuable report on DLA on 20 May.

Mr. Evans: Can the Minister give the House an estimate of how many people he believes are receiving disability living allowance who should not be entitled to it? How many of those who appeal when they lose DLA have that payment restored? May I ask him to ensure that appeals are held as quickly as possible once a claimant lodges an appeal?

Mr. Timms: Perhaps I can draw the hon. Gentleman's attention to the figures that I gave some moments ago. I said that, so far, 138,000 cases under BIP had been checked and, of those, 32,500 people were found initially not to be receiving the right benefit. That number fell to 29,300, after the reviews and appeals that have been completed so far.
The hon. Gentleman's question gives me the opportunity to make one important point. The level of fraud in disability living allowance is very low: the level of confirmed fraud is about 1.5 per cent. The level of incorrectness is greater than that. It is important to distinguish between those two things and to make it clear to the House that the level of fraud is very low.

Benefits (Personal Advisers)

Mr. Ian Pearson: What services will be offered by the personal adviser to people applying for benefits through the single gateway. [58393]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): The personal adviser will help benefit claimants of working age to explore ways in which they can overcome barriers that prevent participation in the labour market. The adviser will be able to provide information and advice on the options that are available and a personalised calculation of potential in-work income.
The personal adviser will also help individuals to gain access to a range of services such as child care provision, specialist counselling, housing support and training.

Mr. Pearson: I thank my hon. Friend for her reply. Any measure that sensibly cuts bureaucracy and introduces clarity into the system has to be welcomed, but can she help to explain whether we are talking about one gateway or two? Do people have one personal adviser or two? Can she assure me that just one person is advising people on the gateway and those who enter the new deal?

Angela Eagle: My hon. Friend must not mix up the new deal programmes that have been launched throughout the country with the 12 pilots of the single gateway, which will begin in June next year and be extended in


November. We hope to learn lessons from those pilots and then consider whether to extend them throughout the benefit system.

Madam Speaker: Mr. Patrick Hall? Mrs. Sylvia Heal? Mr. Andrew Mackinlay?

Mr. Andrew Mackinlay: I am here.

Hon. Members: Not for long, though.

National Insurance

Mr. Mackinlay: What plans he has to change the rules on employers' contributions to the national insurance fund. [58397]

The Parliamentary Under-Secretary of State for Social Security (Mr. Stephen Timms): I am delighted that my hon. Friend is here.
From April 1999, the point at which employers start to pay secondary class 1 contributions will be raised to a new "earning threshold" set at the level of the personal tax allowance—which is £83 per week, as announced by my right hon. Friend the Chancellor of the Exchequer, on

3 November, in the pre-Budget report. Additionally, the current multiplicity of employers' contribution rates for different earnings levels will be abolished and replaced with a single 12.2 per cent. contribution rate payable on earnings above the new earnings threshold. Employers will no longer have to pay contributions on the portion of earnings below the earnings threshold.
Provision for the changes was made in the Social Security Act 1998—which made provision also for the introduction of a new class 1B employers' national insurance contribution, so that treatment of contributions on payments and benefits to employees included in a pay-as-you-earn settlement agreement can be aligned with the tax treatment. Regulations to give effect to all those changes will be laid before both Houses in due course.

Mr. Mackinlay: I concentrated on that reply with considerable vigour. May I ask the Minister what he will do about employers—such as P and O Stena, and Cable and Wireless—who have the practice of paying their employees offshore, thereby avoiding paying national insurance contributions? That practice is not only unfair but unpatriotic. Should it not be stopped, immediately, by legislation? What does he say?

Mr. Timms: I am aware of the concerns expressed by hon. Friend, which we are closely examining.

Iraq

The Prime Minister (Mr. Tony Blair): Madam Speaker, with your permission, I shall make a statement on the situation in Iraq.
As the House will know, on Saturday I had authorised substantial military action as part of a joint US-UK strike against targets in Iraq. British Tornado fighter bombers were about to take to the air, and I had already spoken to the detachment commander to thank the detachment for its bravery and professionalism, when we received word that the Iraqis were telling the United Nations Secretary-General that they had backed down. I should like to explain to the House why we were ready to take such action, why we decided to stay our hand, and why we remain ready to strike if the Iraqis do not fully comply with their obligations.
Let me first put the events in context. Security Council resolution 687 of April 1991, containing the ceasefire terms for the Gulf war, obliged Iraq to accept the destruction of all its weapons of mass destruction and not to develop such weapons in the future. The United Nations Special Commission was established to oversee those processes, with the International Atomic Energy Agency. A further resolution required immediate, unconditional and unrestricted access to any places and records in Iraq that inspectors wished to inspect.
The seven years since then have been a constant struggle between Iraq and the weapons inspectors, who have been backed by the full authority of the UN. The inspectors themselves have been harassed and threatened. Iraq has deceived and concealed and lied at every turn. A deliberate mechanism to hide existing weapons and to develop new ones has been in place, involving organisations close to Saddam Hussein, particularly his Special Republican Guard.
Despite all the obstruction, UNSCOM and the IAEA have been remarkably successful in uncovering and destroying massive amounts of weaponry, particularly following the defection of Saddam Hussein's son-in-law, Hussein Kamel, in 1995. He was murdered on his return to Iraq the following year.
UNSCOM has destroyed, for example, more than 38,000 chemical weapon munitions, 690 tonnes of chemical weapon agents and 3,000 tonnes of precursor chemicals. Furthermore, 48 Scud missiles have been destroyed, as has a biological weapons factory designed to produce up to 50,000 litres of anthrax, botulism toxin and other agents. Without the weapons inspectors, that deadly arsenal would have been available to Saddam Hussein to use against his neighbours. Who can say with any confidence that he would not already have used it?
Huge question marks remain, for example, over 610 tonnes of unaccounted-for precursor chemicals for the nerve gas VX; over imports of growth media capable of producing huge amounts of anthrax; and over missile warheads, particularly those designed for chemical and biological weapons. Iraq has denied weaponising VX, but analysis of missile warhead fragments in a US laboratory showed traces of VX. Further tests were carried out in French and Swiss laboratories. A multinational group of experts concluded in late October that the original US tests were accurate, that the French laboratory had found

evidence consistent with the trace of a nerve gas on one fragment, and that all three laboratories had found evidence of Iraqi attempts to decontaminate the warheads.
The simple truth therefore is that, before the Gulf war, Iraq had built up a vast arsenal of weapons of mass destruction. It has been trying to hide them, and to acquire more, ever since. Despite UNSCOM, Iraq still has weapons of mass destruction capability. We do not know precisely how many, but it still has the skills, the engineers and the equipment to make more. Saddam Hussein has used these weapons before, including on his own people. I am in no doubt that he would use them again, given half a chance.
Let us not forget either that Saddam's conventional military capabilities remain at a very high level: more than 1 million men under arms, including 75,000 in the Republican Guard and 15,000 members of the Special Republican Guard, 2,700 main battle tanks and nearly 400 combat aircraft. That is what he continues to spend his money on, rather than the welfare of his own people.
In October 1997, Iraq sought to exclude US personnel from UNSCOM teams. In the face of international pressure, the Iraqis backed down then, but continued to try to impose controls on the so-called presidential sites. In January 1998, Iraq again objected to US and UK personnel, made explicit a ban on access to eight presidential sites, and threatened to end co-operation with UNSCOM if it had not completed its work by May 1998. We, the Americans and others made it clear that we would use force if Saddam did not change his mind.
On that occasion, Kofi Annan, the Secretary-General of the UN, negotiated a memorandum of understanding under which Iraq confirmed its acceptance of all relevant Security Council resolutions and its readiness to co-operate fully with UNSCOM and the IAEA. This averted military action at the 11th hour. The Security Council's endorsement of this MOU stressed that any violation of it would have the severest consequences for Iraq.
Iraq subsequently resumed superficial co-operation, but on 5 August this year suspended everything but the most routine monitoring when its demand for a declaration saying that it had fulfilled all its disarmament obligations was rejected. A further Security Council resolution in September suspended reviews of sanctions in consequence but endorsed the idea of a comprehensive review of Iraq's compliance with its obligations.
On 30 October, the Security Council unanimously agreed terms of reference for the review, holding out the clear prospect of a statement of the steps that Iraq still had to take, and of the likely time frame for their completion, assuming full co-operation by Iraq. Astonishingly, this offer was rejected by Iraq on 31 October, and the Iraqis then announced that they were ceasing all co-operation with UNSCOM. The Security Council unanimously condemned this on 5 November as a flagrant violation of Iraq's obligations.
I have set this out in detail because it is important that we understand what is at stake. We are talking not about technical breaches of UN resolutions, but about a pattern of behaviour that continues to pose huge actual risks for Iraq's neighbours, the middle east and the entire international community.
Let me now return to the events of the last few days. Following the Iraqi decision to break off co-operation with UNSCOM on 31 October, despite the offer of a


comprehensive review, we and the Americans decided that if Saddam Hussein did not return to full compliance very quickly, we were ready to mount an air attack to reduce substantially Iraq's threat to its neighbours, in particular by degrading its weapons of mass destruction capability, and its ability to develop, control and deliver such weapons.
We did not want a lengthy military build-up of the kind that there had been in February, or endless rhetorical warnings, but we did make it clear that if Iraq did not return to full compliance very quickly indeed, it would face a substantial military strike. A private warning was delivered directly to the Iraqi permanent representative at the UN on Thursday 12 November, giving no details about timing, but leaving no doubt about the scale of what was intended.
Saturday afternoon, London time, was set for the start of the attack. I gave final authorisation that morning for the use of force. I did so with regret, and with a deep sense of responsibility. I saw no credible alternative. The UK's weight in the planned strike would have been substantial, including nearly 20 per cent. of the tactical bomber effort.
Just over two hours before the attack was due to start, we received word that the Iraqis had told the United Nations Secretary-General that they were responding positively to a final letter of appeal which he had sent to them the previous night. We decided that the attack should be put on hold for 24 hours to give us a chance to study the details of the Iraqi response.
The first Iraqi letter appeared to agree to resume co-operation with UNSCOM and the IAEA. It was described as unconditional by Iraqi spokesmen, but the full text of the letter, and in particular nine assurances that the Iraqis were seeking about the comprehensive review—they were listed in an annex—left that unclear. We and the Americans spelled out that that was unacceptable, and that there could be no question of any conditions.
During the course of Saturday night and Sunday morning, the Iraqis offered a stream of further written and oral clarifications, making it clear that their compliance was unconditional, that the nine points were merely a wish-list, not conditions, that their decisions of August and October to withdraw co-operation had been formally rescinded, and that the weapons inspectors would be allowed to resume the full range of their activities in accordance with UN resolutions, without let or hindrance. I have placed the text of the Iraqi letters in the Library of the House.
The clarifications, taken together, mean that Saddam Hussein has completely withdrawn his positions of August and October. No concessions of any kind were offered to him in exchange. There was no negotiation of any kind. Nor could there have been. Nor will there be in future.
We do not take Iraqi words at face value. Long experience has taught us to do the opposite. However, we had asked for unconditional resumption of co-operation, and, in the face of the credible threat of force—in this case very imminent force—Iraq offered that resumption. In those circumstances, we and the Americans have suspended further military action while we bolt down every detail of what the Iraqis have said, and while we

test the words in practice. The Security Council decided last night that UNSCOM and IAEA inspectors should resume their work in Iraq immediately. They will be in Iraq tomorrow, and they must be afforded full co-operation in every respect.
As ever, we do not rely on the good faith of Saddam Hussein. He has none. We know, however, that under threat of force, we can make him move. We will be watching with extreme care and a high degree of scepticism. Our forces remain in place and on high alert. We and the Americans remain ready, willing and able to go back to the use of force at any time. There will be no further warnings. The inspectors will now carry out their work.
There are in my view two substantial and fundamental differences between the Iraqi climbdown this time and the climbdown in February. First, there is now a very clear diplomatic basis for action without further need for long discussion in the Security Council or elsewhere. In February, we allowed a long time for negotiations. This time we allowed only a short period. If there is a next time, there will be not even that. If there is a next time, everyone will know what to expect, as President Chirac and others have made clear.
Secondly, the world can see more clearly than ever that Saddam Hussein is indeed intimated by the threat of force. Many so-called experts told us that Saddam wanted military action—even needed it—to shore up his position internally and in the region. His complete collapse on Saturday gives the lie to such bogus analysis. When he finally saw, correctly, that we were ready to use force on a substantial scale, he crumbled. I hope that other countries more dubious of the use of force may now see that Saddam is moved by the credible threat of force. He has exposed the fact that his fear is greater than his courage. Let us learn the lesson of that.
If there is a next time, I shall have no hesitation in ordering the use of force. President Clinton's position is the same. The USA and the UK, with far greater international support than ever before, have Saddam Hussein trapped. If he again obstructs the inspectors' work, we will strike. There will be no warnings, no wrangling, no negotiation and no last-minute letters. The next time co-operation is withdrawn, he will be hit.
We have no quarrel with the people of Iraq. On the contrary, we support the desire of the overwhelming majority of them for freedom from Saddam Hussein. They find themselves in a desperate position. I have no doubt of the genuine suffering of many, though not, of course, the elite and those who keep in them in power. We do what we can through our aid programme. Under the oil for food arrangements, the Iraqis can import as much food and medicine as they want, and I hope that we will hear no more echoes here of cynical and hypocritical Iraqi propaganda about this. If Saddam Hussein wants to import more, he can do so freely. If he wants the sanctions position to change, the solution is in his hands through fulfilment of his obligations.
This is far from over. It is merely in a different phase. Our course is set: complete compliance and nothing less, and we shall not be moved from that course.

Mr. William Hague: I thank the Prime Minister for his statement and in particular welcome the willingness that the Government and the


United States have shown to use force to ensure Saddam Hussein's compliance with UN resolutions. Last week, we pledged support for the use of force, should it prove necessary. The Opposition also support the Prime Minister's decision at the weekend to authorise the use of RAF aircraft. We join him in commending the bravery and preparedness of the RAF personnel involved in the mission—no less for the fact that they did not in the event go into action. We welcome Saddam Hussein's apparent assurances that he will allow UN inspectors complete and unconditional access to suspected illegal weapons sites, as well as the Prime Minister's statement that if there is any future breach of the undertakings that Iraq has given, air strikes will be launched without further warning.
At the same time, the Prime Minister will no doubt share our concern, first, that the crisis through which we have just passed represents the second time this year that Saddam Hussein has broken his word and failed to comply with UN resolutions; secondly, that he may still be playing for time and testing the west's resolve; and thirdly that these exercises in brinkmanship are being regularly repeated.
Does the Prime Minister accept the Opposition's continuing strong support for maintaining a tough line against Iraq until the complete destruction of that country's biological and chemical weapons capability has been achieved? Does he further accept that we believe that this determination should embrace sanctions as well, and that the lie should be nailed that the sanctions currently in place are depriving the Iraqi people of food and medical supplies? The Prime Minister made the important point that the continuing suffering of many Iraqis is the direct responsibility of their own regime. Given that Iraq can now sell more than $10 billion of oil annually to pay for food, medicine and other humanitarian goods, should not the blame for the deprivation of the Iraqi people be placed firmly at the door of Saddam Hussein himself, who chooses to spend the money on weapons of war and the luxurious life style of his entourage?
Given that it has repeatedly proved impossible to negotiate in good faith with Saddam Hussein, does the Prime Minister associate the Government with President Clinton' s statement:
what we want and what we will work for is a government in Iraq that represents and respects its people … and one committed to live in peace with its neighbours."?
We all hope that Saddam Hussein is indeed now trapped, but as the Prime Minister said, this matter is far from over. Will he go further and agree that Saddam's continued breaches of faith, and the continuing threat to peace that he presents to the whole of the middle east and thus to the interests of the United Kingdom, mean that although we acknowledge the formidable difficulties involved, a prime objective of western policy should now be the removal of Saddam from power?

The Prime Minister: I thank the right hon. Gentleman for his support and his party's support in the past few days. Of course we want to see the Iraqi people governed by a regime other than that of Saddam Hussein. We are looking with the Americans at ways in which we can bolster the opposition and improve the possibility of removing Saddam Hussein altogether. I entirely share the sentiments that President Clinton expressed on that point.
I also agree with the right hon. Gentleman about the continued suffering of the Iraqi people. We have to be blunt about it. I have no doubt at all that Saddam Hussein will not fulfil the obligations that he has now entered into unless he is made to do so, but what is interesting and different about the present situation is that this time he was able to see that we had given the authorisation to strike. Indeed, until late Saturday morning, that decision had been taken and was literally minutes away from being implemented. Therefore, no one can doubt the credibility of our willingness to use force and, most important of all, Saddam Hussein no longer doubts that.
What is more, precisely because of the build-up that there has been over a period of months, we are in a far stronger position. Reading between the lines of what Kofi Annan, the UN Secretary-General, said, it is clear that he accepts—as does the entire international community—that the next time there will be no formal negotiation at all. If Saddam Hussein withdraws co-operation, action will follow, irrespective of last-minute pleas, letters and the rest. It is that simple. That represents a significant difference from the position in February.
I also emphasise the other point that I made. I was astounded, because I did not accept the argument, by the number of people who genuinely and in good faith thought that Saddam Hussein would welcome military action and that he needed it to bolster his position. According to so-called experts, it was all part of his ploy and he wanted military action as it would strengthen his position. My goodness—the moment he thought and knew that we were serious about military force, a very different song was sung by those who were speaking for Iraq. The fact that that changed in a fundamental way places us in a very good position.
I should make it quite clear to the House again, however, that this will not be over until the inspectors are in there and have completed their work to their satisfaction; or alternatively, because Saddam Hussein fails to co-operate again, until we have by military force diminished and degraded his capability to threaten the neighbourhood and the outside world. One of two things will now happen: either he will co-operate, in which case inspectors will do their job, or he will fail to co-operate and, as we have made quite clear, force will follow.

Mr. Menzies Campbell: I offer my support to the Prime Minister for his statement and for the Government's conduct of these affairs in recent days. In his statement, the Prime Minister refers to a clear diplomatic basis for military action. Is he satisfied that there is clear legal authority for military action? Does he agree that one of the most effective parts of the diplomatic effort against Saddam Hussein was the intervention of a number of Arab states towards the end of last week, in particular Egypt and Syria? Does he agree that it is necessary to seek to maintain the support of Arab opinion; in that regard will he confirm that we will be evenhanded in our application of United Nations Security Council resolutions throughout the entire middle east?
Will the Prime Minister confirm that sanctions are related to compliance and not to the survival in power of Saddam Hussein, and that if there is full compliance all sanctions can be lifted? Finally, will he confirm that,


notwithstanding Saddam Hussein's behaviour, we will redouble our efforts to bring humanitarian assistance to those whom Saddam Hussein has so cruelly exploited?

The Prime Minister: I thank the hon. and learned Gentleman for the support that his party gave for the action that we took. Yes, we are sure that we have—and will have in future—proper legal authority for the action that we were about to take. The support of the Arab states in their statement last week was significant and has strengthened our position. Although it is frustrating for us, when people see that we are prepared to give Iraq every chance to come into compliance, that is an important part of building up the strongest possible diplomatic support. Obviously we want to maintain that.
The fact that, thanks to the intervention of President Clinton and others, the middle east peace process is back within a framework that gives it some chance of success is an indication to the Arab world that we wish to be even-handed in our approach and that we simply want to maintain the security of the region in all its different forms.
The sanctions are, of course, related to compliance. Saddam knows that, which is why the issue has always been in his hands. He can determine the matter, if he is prepared to come into line with the UN resolutions in their entirety. On the humanitarian side, what is important is that we continue to do whatever we can and, at every single stage, counter the lying Iraqi Government propaganda that babies are dying and people are being starved of food because the west will not allow supplies to come in. I think that I am right in saying that, of the aid for medicines, only 30 per cent. has gone anywhere near the people who should have received that medical assistance. The rest of it, and a large part of the money for the food programme, has gone to that small number of elite people around Saddam Hussein who are keeping the rest of the Iraqi people in repression.

Mr. John Major: The Prime Minister is right to have supported the United States and the United Nations resolutions over the past few days, and I believe that he was right to commit British forces to take part in any punitive exercise that was necessary. He will also be right if he commits British forces in future without further warning, because that warning has now clearly and unequivocally been given.
Since 1991, Saddam has flagrantly broken every promise he has made. He is developing nuclear weapons, chemical weapons, biological weapons and a delivery system. Unless those weapons are removed, no one can have any confidence that the day will not come when he seeks to use them on neighbouring states, whether on Tel Aviv, Riyadh or elsewhere. We are aware that he has those weapons and it would unforgivable if we did not continue to take the action to ensure that he cannot use them in future.
The Prime Minister mentioned the enormously important contribution of the Arab states and he was right to do so. However, he knows that a different message often goes out from the mosques after prayers, week after week. Will he instruct the Foreign Secretary to do everything he can to repeat the message that our dispute is with the Iraqi regime, not with the Iraqi nation and

certainly not with Arabs generally across the middle east? It is vital that we continue to retain the active and positive support of Arab nations.
This is Saddam's crisis and nobody else's. It will not be ended until those weapons are moved, one way or another. If the Prime Minister is forced to order further force, he may do so with a clear conscience. The responsibility lies in Baghdad, not in Washington or London.

The Prime Minister: I agree with everything the right hon. Gentleman says. I thank him for his support and assure him that we shall certainly act as he urges us to do in respect of the Arab states. Their statement last week was an important development, but we have to keep up the argument the entire time. I entirely agree that the dispute is with Saddam Hussein and not with the Iraqi people, nor with the rest of the Arab world. We have to carry on repeating that message all the time.
I thank the right hon. Gentleman for his support, because on issues such as this it is important that there be cross-party support. One of the things that we have learnt from dealing with Saddam Hussein is that he looks carefully to see how much support there is and how much he can attempt to win by means of divide and rule. Therefore the greater support there is across the political divide here, the greater the impact on him and the greater our ability to avoid the use of force.
I also entirely agree with the right hon. Gentleman about weapons. As I said a few moments ago, one of two things will happen: either the inspectors will do their work and complete it, or we shall take action ourselves to diminish the weapons of mass destruction capability.

Mr. Donald Anderson: May I congratulate my right hon. Friend on his steadfast resolution and that of our US allies, which has prevented, for this time, further defiance of the world community by Saddam Hussein? However, as my right hon. Friend will realise, in the US over the weekend there has been a subtle change of policy, which is to heighten the policy objective of toppling the regime in Baghdad. Would he care, first, to spell out whether that is fully agreed to by the Government; and secondly, to state what it means in practice? Does it mean, for example, arming or financing opposition groups? Is he aware that the most credible of those opposition groups have already rejected such assistance?

The Prime Minister: As I said a moment ago, we have to consider with the US the support that we can give the opposition to the Iraqi regime, and that is a legitimate aim for us. If it is the case—and no one can seriously doubt it—that Saddam Hussein does not act in good faith and unless prevented will unquestionably pose a threat to his neighbours—let alone the repression that he visits on his own country—it is an entirely sensible policy objective for us to do all that we can to support opposition to him. We must simply seek the most sensible way of achieving that. That is by no means inconsistent with, and indeed is complementary to, our other objectives.

Mr. Nicholas Soames: I warmly endorse the Prime Minister's praise for UNSCOM, but is he aware that since the Annan agreement, UNSCOM's work,


although successful, has been like drawing hen's teeth and it is thought that much of that work has been compromised? Will the Prime Minister tell the House what limits he will assign to obstruction by the regime in Baghdad to UNSCOM's work; and in the event of such obstruction, at what stage he will consider that action will be necessary to ensure that the work is made possible?

The Prime Minister: The important thing is that UNSCOM does its work without any let or hindrance, and the Iraqis have now agreed to that. We shall obviously consider carefully the reports made by UNSCOM to ensure that that condition is being kept. The hon. Gentleman is right—work has been largely compromised since February. If that starts to happen again, we will regard it as a breach of the undertakings that have been given; so we will make a judgment based on UNSCOM's reports, and we must monitor that situation extremely carefully.
If the Iraqis think that they are returning to the position that they were in between February and 30 October, when they withdrew all co-operation, they are wrong. We expect the inspectors to go back into Iraq and be able to complete the work that they were tasked with by the UN resolutions. Again, I stress that all we are demanding is that the resolutions made at the end of the Gulf war—from which these events derive—be implemented in full. We shall watch the work every inch of the way.

Mr. Tony Benn: Is the Prime Minister aware that although the world is united in its hostility to the regime of Saddam Hussein and its desire to have the United Nations resolutions carried out, there is no possibility—and the Prime Minister should admit it—of carrying through the Security Council a resolution authorising force against Saddam? He has not even attempted to do so. If an operation, once suspended, were launched now without further notice, the effect on the middle east, as the former Prime Minister, the right hon. Member for Huntingdon (Mr. Major) pointed out, would be absolutely catastrophic for the influence of the United States and Britain in that area.
If force were used to change the regime in Iraq, which President Clinton has hinted at and the Prime Minister has now confirmed, that would put us totally outside the realm of legitimacy in international law and the United Nations charter.

The Prime Minister: I can say two things to my right hon. Friend. First, we believe that the legal basis for action is secure because of the UN resolutions that have been passed and the need to enforce them.
Secondly, let us examine what has happened over the past few days. I cannot believe that anyone seriously thinks that the Iraqis, who two weeks ago had withdrawn all co-operation and effectively prevented UNSCOM from performing their duties, would have today allowed the inspectors back in unconditionally—they say—to do their work normally, without let or hindrance, except under duress and the threat of force. It is simply not credible that they would have altered their position unless they were threatened with military action.
I say to my right hon. Friend and those in the international community who are hesitant about the use of force that it is no good willing the ends unless we will

the means. It is absolutely no good saying to the outside world that we want the UN resolutions on eliminating weapons of mass destruction to be carried through if we are at the same time saying that we will never contemplate the use of force to ensure that they are carried through. It is perfectly obvious from what has happened that if we took that position there would be no elimination of weapons of mass destruction and we might as well render those UN resolutions of no effect at all.
It simply cannot be overstated—we have learnt this on many occasions—that when we are dealing with a dictatorial, brutal and corrupt regime such as that of Saddam Hussein, diplomacy works only if it is backed up by the credible use of force.

Sir John Stanley: Will the Prime Minister confirm that the UNSCOM inspection teams, whose work is absolutely critical, will have the unambiguous and unqualified support of the American and British Governments, in particular, in inspecting both declared and undeclared sites?

The Prime Minister: Yes, I can confirm that absolutely.

Mr. Gerald Kaufman: I congratulate my right hon. Friend and President Clinton on facing down the procrastinations and tergiversations of murderers and torturers, and on demonstrating to those who toddle off periodically to Baghdad to get their skins tanned and their noses browned that only force or the threat of force has any effect on such people in their violation of a succession of Security Council resolutions.
My right hon. Friend has confirmed to my right hon. Friend the Member for Chesterfield (Mr. Benn) and others that existing Security Council resolutions specifically authorise the use the force—as they did when the right hon. Member for Huntingdon (Mr. Major) was Prime Minister. Although he has understandably dealt today with the consequences of the Iraqi attempts to fail to conform to the United Nations Security Council resolutions on weapons inspection, will my right hon. Friend confirm also that there is no prospect of sanctions being lifted until Iraq complies with not only the weapons resolutions but the whole range of UN resolutions?

The Prime Minister: It is essential that everything that the United Nations has set out should be implemented. I agree entirely with my right hon. Friend and welcome his support for ensuring that those Security Council resolutions are implemented in full. I emphasise that that must occur because Saddam Hussein has been trying to develop weapons of mass destruction.
I urge upon those who are doubtful of the need to threaten to use force that we are not talking about technical breaches of the agreements. Saddam Hussein was developing weapons of mass destruction before the Gulf war. He has continued to try to do so since then and to conceal it. If he were successful, the threat to the world would be enormous. He is the one who has used chemical weapons—and he used them against his own people. Some 5,000, mainly women and children, were killed as a result of chemical warfare.


It is essential that we keep in place the existing mechanisms and maintain eternal vigilance until the Security Council resolutions are complied with in full.

Mr. Martin Bell: I am put in mind of the relationship between another Prime Minister and another President who met twice a year—first she told him what she thought and then she told him what he thought. However, these are different times and different people. Can we be assured that Britain has an independent voice in this matter and not just an echo; and that there is at least a prospect of revisiting that grand coalition—not only in this country but in the United Nations, and especially in the Arab world and the Gulf states—that was put together when last we committed our armed forces to the Gulf, in 1990-91?

The Prime Minister: Yes. We have been active in building up as much support as possible. As we have said, the supportive statements made by European Union members and by the Arab states demonstrate the degree of backing for our position. The words of the United Nations Secretary-General yesterday are obviously very important also.
As for our having an independent voice, I believe that what we did was right—if I did not believe it was right, I would not have done it. While I believe that it is important that this country is—and always will be—the master of its own foreign and defence policies, I do not make any apologies for our relationship with the United States of America. As I have often said: thank goodness the United States is there and prepared to act in these situations, even if others are not. If we had not been prepared to act in this situation—I could mention many others who were not—the possibility of securing peace and stability in the world would have been much diminished.

Mrs. Gwyneth Dunwoody: My right hon. Friend has revealed an horrendous list of weapons to the House today. Will he make it clear that, if a man who is unstable and who rules a regime as totally unacceptable as that in Iraq remains in control of savage weapons of war, no one will be safe until we can guarantee that they have been completely withdrawn and destroyed? Does he understand that it is essential that the inspectors work as rapidly as possible, and will he ensure that the period that Iraq is allowed is foreshortened? If those weapons are allowed to remain, no one will be safe.

The Prime Minister: I entirely agree with the sentiments that my hon. Friend just expressed. It is important that the inspectors be able to gain access, not just to the declared sites, but to the undeclared sites—and to all the various documentation, because that too is important in uncovering the weapons programme. Of course, that is all part of the agreement that Saddam Hussein entered into at the end of the Gulf war. The agreement, negotiated by the then Prime Minister, the right hon. Member for Huntingdon, and by President Bush, was that Saddam Hussein would destroy all weapons of mass destruction; and the inspectors were put in there in order, as it were, to certify that he had carried

out that programme. The truth is that they have had to carry out the programme and he has spent six or seven years trying to dodge it.
I totally understand the frustration of people who say, "This has all taken an awful lot of time." Yes, it has, but at each stage we are eliminating the weapons, ensuring that the inspectors can go back in and do their work, and building the basis for the use of force again if Saddam Hussein pulls back from the undertakings that he has given.

Mr. John Wilkinson: May I express my appreciation to Prime Minister for coming to the House in person to make this important statement? He has put his credibility on the line, in as much as he has explained why he has taken our armed forces to the brink of war and not beyond, and we hope that the policy will be successful. He also mentioned the issue of conventional armaments. Does he envisage any extension of sanctions to prevent Saddam Hussein building up his conventional weaponry, which is already fearsome enough?
The Prime Minister spoke of our allies—the United States and President Clinton—in glowing terms, but there were some notable absentees in this matter. What about our European friends? At Vienna, he was eulogising the common foreign and security policy; what has become of it over this crisis?

The Prime Minister: I thought for a moment that we were going to get through a question by the hon. Gentleman without a knock at Europe. In fact, the European Union—as it said in a statement last week and, I understand, as it is saying today—will be very helpful to, and supportive of, what we do.
The sanctions regime is tied to a series of things that must be done by Saddam Hussein. If we carry out all the things that are in the various UN resolutions, we shall have secured the objectives that we have set ourselves in respect of armaments, and I believe that we shall do so. Those resolutions amply justify the action that we are taking.
Of course our credibility is on the line here; it always is in these situations, but I think that we are right to say that we shall not hesitate to act if Saddam Hussein goes back on the undertakings that he has given.

Mr. George Galloway: I am for rooting out these hideous weapons wherever they are, whether they are the ocean of chemical weapons that the United States of America dropped on the people of Vietnam, or the biological weapons in the Israeli arsenal, some of which we read about at the weekend, which strike a new low even in that dreadful alchemy.
In 1956, a less distinguished predecessor of my right hon. Friend stood at that Dispatch Box and asked who would chain
the mad dog of Cairo".
It was a precursor to a devastating Anglo-Israeli attack on Egypt, with cataclysmic results; this time we were minutes away from an equally cataclysmic mistake. Does the Prime Minister really think that the kings and sheikhs at Doha were speaking for the Arab people—speaking for the Muslims of the world? I hope that he does not; I hope that he knows better than that.


Will the Prime Minister answer one question? Why is it that Israel, which illegally occupies three Arab countries, is allowed to have nuclear, chemical and biological weapons, but no Arab Muslim country is allowed to have the same thing?

The Prime Minister: In trying to compare Israel to Iraq, my hon. Friend simply underlines the misguided nature of his own arguments. Quite apart from the fact that Israel is a democracy, we cannot see Saddam Hussein in the same light at all. At the beginning of his remarks, my hon. Friend said that he was in favour of making sure that the weapons of mass destruction were destroyed. That cannot be done unless there is the threat of force to back up the diplomatic efforts.
As for speaking for the Arab people, I believe that those to whom my hon. Friend referred were speaking for the Arab people, but I agree that there is a large measure of disagreement in the Arab world—all the more reason for us to be out there saying with one voice, "This is not a quarrel with the Arab people. It is not a quarrel with the Iraqi people. It is a quarrel with Saddam Hussein." After all, the biggest single immediate threat that Saddam Hussein poses is to the Arab nations of the world.

Mr. Crispin Blunt: I support the Government and the Prime Minister's action in coming to the House to make a statement. The Prime Minister will need no reminding of the complications and difficulties that can arise from the use of limited force in response to unlimited tyranny. Can he assure us that he was operating with the authority of all his colleagues, that the matter was given careful consideration and that the defence and overseas policy committee of the Cabinet had met prior to the decisions that he took on Saturday?

The Prime Minister: I assure the hon. Gentleman that we were acting with the full authority of the Government, as he would expect. The action that we worked out was proportionate and right. It would have achieved the objectives that we had set for any military action—first, by degrading the capability of making weapons of mass destruction, and secondly, by diminishing the threat that Saddam Hussein posed to his immediate neighbours. Both those objectives would have been satisfied by the military action, and I can assure the hon. Gentleman that that was the united position of the entire Government.

Mr. David Winnick: Is my right hon. Friend aware that those of us who, 42 years ago, vigorously demonstrated against the British, French and Israeli aggression, believe that we are perfectly justified in campaigning against the Iraqi dictator at every opportunity? Is it not the case that since 1990, the division in the House has been between those who want to face up to the criminal nature of the regime and those who want to appease Saddam Hussein? Those who now criticise my right hon. Friend and the American Administration for what they have done are the very people who in 1990 and 1991 justified the invasion of Kuwait. Had we listened to such people, no action would have been taken to liberate Kuwait. We were right then, and we are certainly right now.

The Prime Minister: I entirely agree.

Mr. Michael Fabricant: The Prime Minister is right when he says that the patterns of

behaviour demonstrated by Saddam Hussein amount to continued deceit. The Prime Minister is also right to consider the use of force and to maintain that threat, but what will happen if Saddam Hussein again agrees with Kofi Annan, accepts the United Nations proposals and six months later changes his mind? How long will we keep troops on station? How long is the United States prepared to keep two aircraft carrier groups in the region? Once they withdraw, is it not possible, as the Prime Minister admitted, that Saddam Hussein might change his mind again? What will happen if, in the time that it takes to bring our troops back, Saddam Hussein again concedes to the UN demands?

The Prime Minister: There is a simple answer: we will remain ready to act whenever Saddam Hussein withdraws his co-operation. Although it is easy to say, it is not a correct description of the situation to state that we are in the same position as we were back in February. The substantial differences are, first, in February, there was a long build-up to the memorandum of understanding; it has been two weeks since Saddam Hussein's decision of 30 October to withdraw co-operation. I do not believe that anyone doubts that we will move straight away next time. It is important for us to be able to say to the entire outside world, "This is not action that we take willingly. It is not action that we want to take, but it is action that we feel obliged to take, having exhausted all other avenues."
Secondly, Saddam Hussein now knows that we are deadly serious. He knows that the planes were very nearly ready to mount the strike before he made his offer and climbed down. He has to realise, and I believe that he does, that next time there will be no time for that at all.

Mr. Tam Dalyell: I agree with my right hon. Friend that this is far from over—but will it ever be over until such time as there is the prospect of sanctions being lifted? Does my right hon. Friend accept the glimmer of hope that was given by Kofi Annan, that part of a package would be that at last, after seven years, there would be the prospect of sanctions being lifted?
Secondly, last Sunday Albert Reynolds and I sat in the office of Jaakko Ylitalo, who is the acting director of UNSCOM. He said that UNSCOM had visited 496 sites and that there had been no violation in any of those sites. Furthermore, he talked in terms of a three-month time limit. Could a full look be given at this very complex area of precisely what UNSCOM has found and what it hoped to find?
Finally, to use the felicitous phrase of my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman), might it not be so bad an idea if a delegation of preferably Arabic-speaking people—senior officials—went to Baghdad not to get their noses brown but to talk in terms of dignity to the proud northern Arabs whom, let us never forget, we were content to provide with arms throughout the 1980s, when we hoped that they would not be defeated by the Ayatollah and militant Islam? This is a very complicated area. Please send some kind of delegation to talk to them before we think of hurling down missiles.

The Prime Minister: I respect the fact that my hon. Friend has different views on these matters. First, I say to him that we have made the position very, very clear to the Iraqis again and again. They know what they have to


do to get sanctions lifted. They have to do what they agreed to do at the end of the Gulf war. The fact that sanctions are still in place is a measure not of our obduracy but of the fact that they have not implemented what they agreed to do at the end of the Gulf war.
As for UNSCOM, it is there to do a job of work that it knows is not yet complete. There is no doubt at all that there are still weapons unaccounted for. I listed in my statement—I did so deliberately—the vast arsenal of weapons that has been uncovered.
No matter how much we would wish for Saddam Hussein to be a different type of person from what he is, the fact is that he is a brutal dictator who has used chemical weapons against his own people. He has repressed and murdered thousands of his own people. The country is run by an elite guard of people who are well fed, well looked after and well paid while the rest of the population is under repression. When people oppose him, this is a man who seeks a way to murder them. He is not a man in whom we can have any belief that he will do the right thing, except under duress.
As for the Iraqi people, we constantly make the point, as do Arab countries, that the quarrel is not with them. However, we must not be naive about this. There is no way Saddam Hussein will offer us any way forward unless he knows that if he does not do what he has agreed to do force will follow. I am afraid that that is the inescapable conclusion of the past few years.

Mr. Edward Leigh: I commend the Prime Minister's statement that there is no point in wishing the end without willing the means, but has he noted the criticism of some Gulf war veterans that the allies' war aims are somewhat confused? What are the Prime Minister's aims? Are they to remove Saddam? No tyrant has ever been removed by aerial bombing alone. Or are they to destroy chemical and biological stocks? As those are easily dispersed, they cannot be destroyed by aerial bombing alone. Is the Prime Minister therefore willing to contemplate military action on the ground?

The Prime Minister: We have set out our position with great clarity: we want UNSCOM to do its work because that is what Saddam Hussein agreed. If he refuses to let UNSCOM do its work, we shall take military action, the purpose of which is twofold: first, to degrade the weapons of mass destruction capability; and secondly, to diminish Saddam's general military capability to threaten his neighbours. Those objectives are plainly set out.
We believe that, in the action that we were about to take, we could have delivered both those objectives. They remain our objectives, so there is no confusion at all. However, we should never promise that we can achieve something unless we are sure that we can achieve it. We are sure that we can achieve the objectives that we set out.

Mr. Dale Campbell-Savours: I congratulate my right hon. Friend and the Defence Secretary on the resolute way in which they have gone about this matter over the past couple of weeks. May I draw my right hon. Friend's attention to the Foreign Secretary's comments last week in the House, when he conceded that illicit revenues secured in breach of United

Nations sanctions—from oil supplies from Iraq to Iran through the straits to the south and through Kurdistan in the north—are funding Saddam Hussein's whole operation in Baghdad, particularly the Republican Guard? Why will not the United Nations carry a resolution to enforce a blockade effectively to cut off those oil revenues? When the money is cut off, Saddam Hussein will fall.

The Prime Minister: My hon. Friend is right. Together with our allies and friends, we are looking at how we can tighten the regime. He is right to say that there has been seepage from the sanctions regime. Any seepage undermines the efficacy of the sanctions. We hope that we can take steps to tighten that regime.

Mr. Christopher Gill: The Prime Minister has paid generous praise to the United States of America for the enormous effort that it makes to carry out United Nations resolutions. The House knows that this country has often sided with the US in carrying out those resolutions. Although we may not contribute much by way of munitions, it is important psychologically that the world sees that the United States does not stand alone, but has an ally in discharging those obligations.
Should we be rash enough to join a common European foreign and defence policy, it would be practically impossible for us to be an ally to the United States when it tries to carry out such difficult operations. is it fully appreciated in Washington that, if we were propelled into a common European foreign and defence policy, we would no longer be in the present happy position of reinforcing the US President when he takes such action?

The Prime Minister: I thank the hon. Gentleman for his initial statement. On the second point, however, he is just wrong. I am aware of no discussion of any sort in Europe that would either compel us to join some defence policy that would undermine our alliance with the United States or inhibit our ability to act with the United States where necessary.
I remind the hon. Gentleman that the European security and defence identity within NATO was set up a couple of years ago, quite rightly, to recognise the European dimension. That does not mean to say that we have to act in contradistinction to, or contradiction with, the work that we do with the United States. However, it is important that Europe should have a more effective foreign and security policy. Our bottom line is to achieve that in the right way, which in no way undermines or inhibits our relationship with the US and NATO.
I think that the hon. Gentleman will find, as so often, that, once we strip away the paranoia—if I may describe it as that—of those who are opposed to anything with the word "Europe" in its title, we will see that the United States would welcome a stronger voice from Europe on many occasions. If Britain is sensible, we can use our relationship with the United States—and if we are positive and constructive in Europe, we can use our relationship with the rest of Europe—to make sure that the EU and the United States
follow the same strategy. That would be to the benefit of the whole world.

Ms Bridget Prentice: Last week, an all-party delegation visited the United Nations and met members of the Security Council. Is my right hon. Friend aware of the high regard in which the Government are held in the UN? Much credit should be given to Sir Jeremy Greenstock, our ambassador, and his team there.
Would my right hon. Friend remind Members of the House and others who are timorous about doing what is right that eight Arab states last week laid the blame entirely at the door of Saddam Hussein? Will he reiterate his view that, if Saddam Hussein back-tracks by one degree, no more talking will take place, but force will be used?

The Prime Minister: That is absolutely right, and I thank my hon. Friend for her support. She is right to draw attention to the work that Jeremy Greenstock did in the United Nations over the weekend. He and the team there were quite magnificent and played a great part in securing the result that we wanted.

Agriculture (Aid)

The Minister of Agriculture, Fisheries and Food (Mr. Nick Brown): From swords to ploughshares.
During oral questions on 12 November, I told the House that I would wish to make a statement early this week about the Government's intentions on additional aid to United Kingdom agriculture. I stand here to honour that undertaking.
Since I took office as Minister of Agriculture, Fisheries and Food in July, my colleagues and I have had wide-ranging discussions with farmers' leaders and with working farmers around the country about the problems being faced this year, and how we might reasonably address them. It has become clear that all sectors, but particularly the livestock sector, have been adversely affected by a marked deterioration in market conditions.
The weather has made it difficult to grow adequate supplies of feed for the coming winter and to finish stock. In consequence, animals have had to be kept for longer than usual, and are now coming on to an over-supplied market. The collapse of export markets in Asia and in Russia has exacerbated that situation, leading to further pressures on the United Kingdom market from supplies from countries which would otherwise export to those markets.
Within the constraints imposed by the common agricultural policy, the Government have already taken many steps to offer extra support to farmers. We paid £85 million in agrimonetary compensation to suckler cow and sheep producers at the beginning of this year. We supported the introduction of a European Union private storage aid scheme for pigmeat in the face of a fall of about 50 per cent. in the producer price of pigs. Additional action was taken in Northern Ireland.
We have relaxed the rules on the moisture content of cereals eligible for purchase into intervention, in recognition of the difficulties caused to cereals producers by the wet summer. We successfully lobbied the European Commission to grant two blocks of private storage aid for sheepmeat to help to move lamb on the market. With effect from 8 October, we removed the obstacles to the export of whole sheep carcases to France, and on beef we have successfully negotiated the introduction of the export certified herds scheme in Northern Ireland, and soon expect a partial lifting of the ban for Great Britain.
In addition, we have persuaded the European Commission and other member states to increase beef premium advances from 60 per cent. to 80 per cent. for this year, thereby considerably easing farmers' cash flow problems. We have met the costs for one year of Meat Hygiene Service enforcement of controls on specified risk material from cattle and sheep, and we have met the start-up and first-year running costs of the new cattle tracing system.
I have had useful talks with the retailing sector, resulting in positive undertakings on origin labelling of meat, and on the welfare and feeding standards to apply to purchases of meat, which will be particularly helpful to pig producers. I have also made representations to public sector purchasers of meat.
Not all those initiatives cost money, but those that do have been worth, in total, more than £150 million to the industry, in addition to the continuing support that it


receives from the common agricultural policy. Discussions with industry representatives, at both ministerial and official level, have persuaded the Government that more should be done to support United Kingdom agriculture in what are proving to be exceptionally difficult times. In recognition of these extremely difficult circumstances, the Chancellor and Chief Secretary have, exceptionally, allowed me access to the reserve for this financial year, and I am grateful to them for that.
In spring of this year, the Government drew down £85 million of agrimonetary compensation for the beef and sheep sectors. There remains the possibility of drawing on a further £48.3 million for the beef sector in the current year. I have asked officials to notify the European Commission today of the Government's intention to draw this sum, and to make it available to producers on the same basis as the beef element of the spring package—that is, to suckler cow producers in proportion to their 1996 premium claims. I do not anticipate any difficulty in persuading the Commission to approve that arrangement. We expect the eventual rate of payment to be about £29.50 per head.
Although those additional payments to the suckler cow sector will be of some help to hill farmers, the Government recognise that more needs to be done to help that fragile sector. We have decided that, subject to approval from the European Commission, we should increase hill livestock compensatory allowances for the 1999 scheme year by £60 million. Although precise headage rates have still to be worked out, we estimate that, broadly speaking, that will allow us to put up rates across the board by about 55 per cent. As is normally the case, the vast majority of producers will receive the increased rates of allowances during February and March 1999.
In the longer term, the European Commission has proposed replacement of the hill livestock compensatory allowance scheme as part of a range of measures in the Agenda 2000 package to assist the rural economy. I intend to undertake full consultation with farmers' leaders and environmental groups on the shape of the successor arrangements.
On 29 July, I announced the Government's intention to close the calf processing aid scheme when the obligation to run it lapses on 30 November. We considered that the scheme was drawing too many calves from the market and squeezing beef producers' margins. However, the Government were asked to reconsider this matter by farmers, who argued that, in the absence of an export market for British beef, closing the scheme now could have adverse consequences for the market.
We therefore encouraged the Commission to review the rate of aid payable under the scheme, and to fix it at a level that would attract the poorer-quality calves from the dairy herd, while leaving the better-quality calves from that herd and those calves from the beef herd to find their own price level on the market. I am pleased to tell the House that the Commission broadly accepted our arguments in this regard, and will shortly publish a regulation fixing a special rate of aid for the United Kingdom under this scheme of 80 ecu, which is around 70 per cent. of the current rate.
The new rate will come into force on the first Monday following publication of the regulation, which will be either 30 November or 7 December. In view of that, we have decided to continue to operate the scheme for the remainder of the present financial year at the new rate. We shall keep the scheme under review with the industry. I know that maintenance of the scheme will be welcomed by dairy farmers.
This aid package for the livestock sector is worth some £120 million in 1999. In assembling it, the Government have concentrated on those areas to which farmers and their leaders attached the greatest priority.
We also need to think of the longer-term future. Government and all associated with food production in the United Kingdom need to work co-operatively to develop a blueprint for a successful, viable agriculture sector. That means, in particular, securing reform of the common agriculture policy—reform that must create conditions to allow sustainable and competitive European Union agriculture to operate effectively on world markets, reduce the burden currently imposed by the CAP on consumers and taxpayers, and free up resources to offer scope for better-targeted measures to support the rural economy and enhance the environment. That will mean significant changes in the way in which we support agriculture, and will require imagination, flexibility and enterprise on the part of all concerned.
My colleagues and I intend to undertake—in close consultation with all interested parties—a thorough review of the Government's long-term strategy for the rural economy. It will develop policies offering the rural areas a secure future. Over coming months, we shall consult widely on a range of issues. Trading conditions will remain tough in the months ahead, but I hope that this package, and the commitment to generating a vision for agriculture, will give the sector the boost that it needs to face the future with confidence.

Mr. Tim Yeo: The whole House, and the whole farming community, will warmly welcome the Government's recognition that a grave crisis faces agriculture in general and livestock farmers in particular—a crisis that threatens the survival of many farm businesses. I welcome the Minister's statement, and congratulate him on listening to farming organisations, to many individual farmers, and, indeed, to the Opposition. In a motion that we tabled two weeks ago, we specifically highlighted three measures that he has announced in regard to the calf processing scheme, HLCAs and agrimonetary compensation. I am delighted that he was able to use the intervening period to secure the Treasury's support for those proposals.
We would, however, be failing farmers, and the country as a whole, if we did not point out that, although the measures are necessary palliatives, they will treat the symptoms rather than the causes.
Does the Minister agree that this second farm rescue package in a year is needed because the downturn in farm incomes, like the downturn in the whole economy, was made in Downing street? Does he agree that the level of the pound during the last 18 months has been a far more important cause of falling farm incomes than the weather? Will he confirm that the total value of the package barely matches the underspend on the agriculture budget during the past two years? In other words, the money that he won


from the Treasury this weekend is really just what had been saved from the total farm budget since Labour came to office. It is welcome, but it must be seen in the context of a drop of more than £2 billion in farm incomes.
Will the Minister confirm that the package will actually be worth less than £2,000 to each of the 60,000 United Kingdom farms that are in less-favoured areas? Will he confirm that, in England, the National Farmers Union estimates that the income of the average farm in a less-favoured area has fallen by £4,700 in this year alone? Will he confirm that many who work on farms in less-favoured areas are earning less than the minimum wage? According to figures relating to the west country, those earnings can be under £1 an hour. Does the Minister realise that farmers need not just cash help, but the level playing field that the Conservative fair deal for farmers would create?
The Minister will be aware of the concern among pig farmers about the contradictions caused by recent conflicting statements from his Ministry and the British Retail Consortium. I fear that his announcement today has added to the confusion rather than ended it. Will he tell us precisely what the positive undertakings he mentioned amount to? For how much longer will British consumers be sold imported meat products that have been produced by methods that are illegal in this country? Why cannot that be stopped now?
Is the Minister saying that, in future, any product that is labelled as British will be grown in Britain, not merely processed here? Does he agree that the poultry industry is also suffering? What does he propose to do to stem the flow of imported poultry from the far east, some of it containing growth promoters that have been banned for years by the European Union? Does he realise that little in his statement clears up the anxieties felt by dairy farmers? Why has he still not announced a lifting of the absurd and unjustified ban on beef on the bone? We wish him well at next week's Council meeting—[Laughter.] Yes, we do. It may be a matter of mirth to Labour Members, but we believe that the country's interests will be served if the Minister can persuade his EU colleagues to lift the export ban.
In that context, will the Minister confirm that, at best, the lifting of the ban will be only partial, and that the export of beef on the bone will continue to be banned? Will he confirm that, in the light of the experience of Northern Ireland, the recovery of our export markets will take some time? As Northern Ireland was helped with export promotion, will he make similar help available to the rest of the United Kingdom?
Does the Minister agree that the heavy burden of regulation on slaughterhouses, for which the industry itself is increasingly having to pay, will lower livestock prices in the future? Is he satisfied that British farms and slaughterhouses are not operating at a disadvantage relative to their European counterparts? Does his statement mean that, from September next year, farmers will be charged for the new cattle tracing scheme? If so, how much will they have to pay?
The package is a helpful aid to the survival of farmers in the short term; but farmers still face huge uncertainties, with Agenda 2000 discussions looming. When will the

Minister make the Government's position clear on Agenda 2000, and explain to farmers just what role the Government envisage for them in the future?

Mr. Brown: I thank the hon. Member for South Suffolk (Mr. Yeo) for wishing me well. I hate to think what he would sound like if I had fallen out with him.
I said that I wanted to involve farmers' leaders in continuing discussions with the Government as the Agenda 2000 package develops. Indeed, we shall have detailed negotiations on that at next week's meeting of the Council of Ministers.
The Government paid for the setting-up costs of the cattle tracing scheme, and relieved the industry of the first year of charges. I shall want to discuss the matter further with the industry, but there will come a time when the charges will have to be transferred to it.
As someone who eats and enjoys eating meat, I am keen for slaughterhouses to be regulated. Regulation is essential to ensuring the safety of the food that is sold.
The hon. Gentleman asked about the beef ban. I have high hopes that we shall be able to secure the implementation of the Commission's proposal for a date-based exports scheme at the meeting of the Council of Ministers on Monday and Tuesday next week. The hon. Gentleman and I share an objective in this regard. As the House will recall, it was the policy of the Conservative party to bring about the lifting of the ban by November; I hope that I shall get it lifted by November—although, admittedly, it will not be the same November. The House will notice another essential difference, in that I am likely to achieve the objective.
My statement contained a good deal for the dairy industry. The hon. Gentleman also referred to the poultry industry. I met representatives of the industry this morning, and they put to me a number of points that I considered entirely reasonable. I shall think very hard about what I can do. The hon. Gentleman was right to put the issue in the context of my initial meeting with the British Retail Consortium, but I intend to meet its representatives again. I am trying to establish a continuing dialogue with retailers, producers and others who work in the food industry, so that we can work co-operatively, rather than the whole industry being characterised by a series of adversarial stances.
I thought that the hon. Gentleman's welcome for my statement was heartfelt, and I am sorry that the rest of his contribution fell away a bit. I noted, however, that he was asking for more money, and I hope that he has cleared that with the shadow Chancellor.

Several hon. Members: rose—

Mr. Brown: Can I make just one point?
The hon. Member for South Suffolk constantly refers to annually managed expenditure, and confuses it with an underspend or a drawdown from the reserve. If an estimate of demand-led expenditure is not reached, that does not allow the Department to take the rest of the money and spend it on something else. A fair-minded House will realise that I did rather better in my relationships with the real Chancellor of the Exchequer than the hon. Gentleman has done in his with the shadow Chancellor of the Exchequer.

Mr. John Home Robertson: As the owner of a farming business that is determined to do


everything possible to keep five men employed—perhaps I should declare an interest—may I express my personal thanks, and, I think, the thanks of farmers throughout the United Kingdom, for a package that demonstrates the Labour Government's powerful commitment to rural Britain?
On a separate point, will my right hon. Friend comment on the huge discrepancies between farmgate prices and the prices that are charged by many supermarkets for many commodities? Can anything further be done about the problem?

Mr. Brown: I am always happy to hear of a pleased farmer. In fact, after today's announcement, I think that I will even be able to find one or two outside the ranks of the parliamentary Labour party. Nevertheless, I am grateful to my hon. Friend for his support for and welcome to today's announcement.
The Office of Fair Trading is taking a hard look at the discrepancy between farmgate prices and prices in the supermarkets. While I want to keep the different bits of the food sector in continuing dialogue, I am also taking an intelligent interest, as I know many others are, in the OFT investigation, and I look forward to receiving its eventual report.

Mr. Charles Kennedy: I welcome the statement and the package of measures contained therein, which will find a broad echo among all rural constituents in all parts of the UK. Does the Minister agree that there is a salutary nature to it, in that it is the second package of relief measures that the Government have been obliged to introduce within the space of 12 calendar months? That in itself vindicates the campaigning that farmers have been undertaking, as well as the parliamentary support, to be fair, in all quarters of the House that has been expressed consistently over that period.
Without being churlish, I think that many hon. Members will reflect on the fact that, not under the current Minister's tenure, but under his predecessor's, if there had been more willingness to try to access a greater extent of the EU compensatory funds earlier, many of those we represent would not be in the depth of difficulty to which they have sunk throughout this calendar year.
As the Minister says, it is inevitably a series of short-term measures. May I therefore direct him beyond the statement—there is no great disagreement about those short-term measures; that is self-evident—to three specific things that he may wish to consider for the future? The first is calling in the chairmen of major high street banks to underscore to them the Government's continuing commitment to agriculture and the need for them to show continuing commitment to farmers who are their customers. That would do a lot to offer stability at community level.
Secondly, on marketing, not least given the Northern Ireland experience since the beef ban was lifted—[HON. MEMBERS: "Where are they?"' Well, perhaps they are out marketing their products. Will the Minister acknowledge that the Northern Ireland experience underscores the need for an aggressive and high-profile marketing drive, both in this country and, more important, in the export markets to which we hope to regain access? Will he do more about that?
Thirdly, will the Minister give even greater emphasis to labelling? There is no doubt that, if there is one silver lining to the overlying cloud that agriculture has been under, it is the fact that at least the British consumer is now more alert to, conscious of, and indeed patriotic about, content, but that that content has to be clearly indicated, particularly with European import products? Will he give further emphasis to that as well?

Mr. Brown: I thank the hon. Gentleman for his welcome to the package. I am in discussions with the British Retail Consortium over labelling schemes, with the Meat and Livestock Commission over marketing schemes and I am due to see representatives of the high street banks shortly to discuss the finance of agricultural businesses.
The package was shaped by farmers themselves. When I went to their big rally at Blackpool, I said that I was going to listen, to learn and to help if I could. I listened very carefully to what they said, and I hope that the package meets, at least in part, the commitments that I gave them then.

Dr. Gavin Strang: Is my right hon. Friend aware that his announcement deserves a warm welcome because of the benefit that it will bring to the industry at a time of massive crisis? Does he agree that the hon. Member for South Suffolk (Mr. Yeo), who speaks for the Opposition, might show a little more humility, not only because of the extent to which his Government compounded the effect of the BSE crisis on the industry, but because, last Wednesday, an article by the Leader of the Opposition in the Daily Telegraph made it clear that there is no way that a Conservative Government would have found the money for this package? Will my right hon. Friend confirm that all the money in the package is new money for the benefit of the industry?

Mr. Brown: The bulk of the money is new money that has been given by the Chancellor from the reserve. Some of it is recoverable through the CAP and from the European Union, but even the share that is recoverable in respect of hill livestock compensatory allowances requires a further 71 per cent. contribution from the UK Exchequer, because of the Fontainebleau agreement that was negotiated in 1996. I welcome what my right hon. Friend said about the shape of the package, and thank him for his support.

Mr. Peter Luff: The Minister will obviously understand that there is great pleasure that today the Lord has given, but there is also concern that in future he may take away. I think particularly of the possible imposition of new charges for a meat hygiene service—specified risk material charges, cattle passports and the threat of a pesticides tax. I urge the Minister to keep all those matters under careful review at a time of great difficulty in the farming industry—difficulty that is likely to endure well beyond today's statement.
On a separate issue, who will lead the review of rural economy policy, an interesting footnote to the Minister's statement? Will it be him or his colleagues at the Department of the Environment, Transport and the Regions?

Mr. Brown: On the last point, I am working with my right hon. Friend the Deputy Prime Minister on the


broader rural agenda, which properly is a matter for both our Departments. Of course, we will consult the territorial Departments as well.
As Chair of the Agriculture Select Committee, the hon. Gentleman is right to remind the House about charges. I intend to discuss those matters further with the industry, but I did say some time ago that there would come a time when charges were transferred from the public purse, which is carrying them at the moment, to the industry. It is clearly right that it should meet those costs in the longer term. Traceability, which underpins the larger of the charges, is here to stay. We would be complete fools to try to push that regime backwards, because it is a requirement of consumer confidence.

Ms Chris McCafferty: I congratulate my right hon. Friend on his sensitivity to the special needs of hill farmers. It has never been easy to eke a living out of upland farming in my constituency, and today's package of measures will be especially welcome there; but will my right hon. Friend give me an assurance that, in looking to the long-term future of British agriculture, he will look for a sustainable and profitable framework for agriculture, especially for hill farmers in constituencies such as mine?

Mr. Brown: The whole purpose of today's announcement is to help hill farmers and others through times that I freely acknowledge are difficult for them. The purpose of helping them through is, of course, to ensure a long-term sustainable and profitable industry that they can take part in. I thank my hon. Friend for referring to my sensitivity. In my previous job, people did not make such references.

Mr. John MacGregor: The Minister is aware of the serious crisis that faces pig producers—the worst I can remember—particularly smaller producers, some of whom, if not quite a number, face bankruptcy. Will he therefore clear up the confusion in relation to his meeting with the British Retail Consortium? In relation to imported products from pigs, does that relate only to fresh products, or does it relate to processed products as well? If it is the former, what further action does he intend to take? Will he also say what success he is having in Government procurement schemes, particularly in the armed forces? Is there any prospect of food aid schemes—for example, to Russia—playing a part in the matter?

Mr. Brown: I am grateful to the right hon. Gentleman for raising the plight of pig farmers. I am extremely sympathetic to the pig industry. As hon. Members who follow the matter know, it has a largely liberal regime, with no great state aids. There are some export refunds and some aids for private storage, but that is about the size of direct state assistance.
There are discussions on opening credit lines to Russia. There may be a possibility of humanitarian aid, including food, being taken up in those discussions, which are on-going. I should welcome anything that would help to clear the surplus from the market.
My discussions with the British Retail Consortium were a genuine attempt by me to help the industry. The agreement applied to fresh meats that would be sold stall and tether-free, and from animals that are not being fed

bonemeal—in other words, animals that are produced to the highest United Kingdom standards. The industry's intention was that that covers not only fresh meats but processed meats, including bacon and products such as pork pies. Supermarkets were willing to take responsibility only for those processed products over which they had direct control—in other words, their own brands. However, I am assured that those account for the majority of supermarkets' volume. We shall continue with the discussions.
On the other large procurers of meat products, I am happy to tell the House that the armed forces are 100 per cent. British in their purchase of pork, and just over 50 per cent. British in their purchase of bacon. They are considering ways of improving that.

Mr. Derek Foster: May I suggest to my right hon. Friend that proof—if any were needed—that he has announced a very good package indeed was provided in the churlish welcome for it given by the hon. Member for South Suffolk (Mr. Yeo)? May I congratulate my right hon. Friend on his negotiating prowess with both the Treasury and the European Commission? May I also praise him for the very speedy way in which he has listened, learnt and now acted to deal with perhaps the worst crisis that I have known in my 20 years as the Member of Parliament for my Teesdale constituency? As hon. Members have already said, is not today's announcement proof of our Labour Government's commitment to the rural economy?

Mr. Brown: The Government are committed to the rural economy and to farmers. As proof of that, I am now willing to accept the invitation that my right hon. Friend extended to me on Thursday to go and meet his sheep farmers.

Mr. John Hayes: Although I welcome the Minister's remarks on the livestock sector, will he tell the House what he is hoping to do for the arable sector? He will be aware that many arable farmers are suffering severe problems, and that prices have collapsed for various crops and products. What will he do specifically for smaller arable farmers? When may we expect an announcement on their sector? When will he tell the House of his discussions with them?

Mr. Brown: I am not in a position to announce any new or further aids, certainly not to the arable sector. If the hon. Gentleman is asking me to draw down agrimonetary compensation that is available for the arable sector, and to charge 71 per cent. of that to the British taxpayer, he should say so clearly. I have taken action—admittedly it has been modest—to help the arable sector, but it has been proportionate. The crisis in the industry is in the livestock sector.

Dr. George Turner: As my right hon. Friend said, today's package will not financially help every farmer. However, in Norfolk, it will be broadly welcomed as a boost to the morale of almost every Norfolk farmer. My right hon. Friend has in a short time shown farmers that he has the leadership and other skills to tackle the tasks ahead. Will he be as determined as I believe he should be, and as determined as the farmers'


union leadership is becoming, to ensure that the package will allow some time to get ahead with Agenda 2000, and not merely delay evil days?

Mr. Brown: I am grateful to my hon. Friend for his remarks. I plan to embark on a continuing dialogue with those who have an interest in those matters, so that we can work together on the Agenda 2000 package and on the increasing liberalisation of world markets that will inevitably come. The United Kingdom must get ahead of the game, not run along behind it.

Mr. Anthony Steen: The Minister has mentioned help for the upland farmers, and the farmers on Dartmoor in my constituency will be delighted to hear that. However, is he aware that, in the past few years, lowland farmers—who raise those famous Devon cattle—have borne the brunt of the problems? I am just wondering whether the Minister is planning to share with lowland farmers any of the money that he has announced for upland farmers. Will they get any help in their wonderful rearing of Devon beef?

Mr. Brown: I announced a range of measures—I did not concentrate only on less-favoured areas—and there is something in the package for the entire livestock industry. Moreover, it is a mistake to assume that one bit of the industry does not have a relationship with the other. Even the arable sector, for example, is growing food for the livestock sector. The relationships are far more complex than the hon. Gentleman's question implies. However, I am grateful for his welcome for today's announcement.

Mr. David Drew: I congratulate my right hon. Friend on coming up with a wholesome, desperately needed package. I specifically welcome the fact that he has managed to spread help across the board—to lowland farmers and to upland farmers, especially in the calf processing aid scheme. However, may I urge him to do everything he can to help smaller farmers—particularly tenant farmers, who are going through a very difficult time—by making it clear that it is wrong to increase rents now, and that rents should be decreased if at all possible?

Mr. Brown: I am very sympathetic to my hon. Friend's comments. Although it is often rash for Ministers to make forecasts from the Dispatch Box, I suspect that, over time, agricultural rents levels will decline as a feature of broader market liberalisation. I welcome his comments on small farmers, and can announce today that I plan to visit Cornwall in January, specifically to meet representatives of small farmers. I shall make that a priority of the visit. I am grateful to my hon. Friend.

Mr. Steve Webb: The Ministry has been honest enough to recognise that, when a farm suffers from the effects of bovine tuberculosis, compensation offered from the public purse covers only one pound in six of the farmer's true loss. Will the Minister clarify whether the package he has announced today will provide additional compensation to farmers in that very specific situation?

Mr. Brown: The package provides some extra support to the dairy sector. However, the way of dealing with

bovine TB is to press ahead with current Government experiments to establish the science once and for all. We can then take action, based on the science, to prevent the spread of such disease.

Mr. Michael Clapham: May I thank my right hon. Friend for his statement, and tell him that it will be warmly welcomed by the farming community in my rural constituency? May I tell him also that small abattoirs in rural constituencies are suffering great hardship? Will he consider ways in which small abattoirs in rural constituencies might be helped to survive?

Mr. Brown: I am grateful for my hon. Friend's welcome for today's announcement. Since becoming Agriculture Minister, I have had to focus on some key problems—such as the immediate difficulties in the producer sector, and the need to work very hard on the politics of lifting the ban on our beef exports. Consequently, until now, I have not been able to give sufficient attention to some of the problems in the middle of the producer cycle—the bit between the producer and the retailer. I intend now to focus on those matters.

Mr. Robert Walter: I am sure that the beef and sheep sectors will be pleased with the Minister's announcement, but I just hope that it does not become an annual event—a sort of farmers' Christmas bonus.
Like other hon. Members, I should like to emphasise the fact that the pig and poultry sectors receive no aid from this package. I am pleased to hear that he met poultry producers today, but I note the confusion between fresh and processed pigmeat. Will the Minister give the House a categorical assurance that, in principle, he is against the import into this country of pig and poultrymeat that is produced to inferior welfare and hygiene standards? Failing that, will he encourage the retail sector to label those products to show that they come from countries with inferior welfare and hygiene standards?

Mrs. Brown: We want a welfare premium for the British industry. As I said, I am very sympathetic to those sectors which work in a relatively liberalised market, especially the pig and poultry sectors. I have engaged retailers in discussions about labelling schemes. I think that, instead of urging me to do something on which I have already embarked, the hon. Gentleman should welcome the fact that I have made a start.

Mr. Win Griffiths: Like many hon. Members, I thank my right hon. Friend for, and congratulate him on, his significant announcement. I am quite sure that the present Secretary of State for Wales, my right hon. Friend the Member for Cardiff, South and Penarth (Mr. Michael), in the short time that he has been in office, and the previous Secretary of State, my right hon. Friend the Member for Caerphilly (Mr. Davies), will both have made significant contributions in putting the Welsh case.
Will the Minister tell us how much farmers in Wales are likely to get? Will he concentrate especially on market issues, as prices in Welsh markets are at absolute rock bottom, and there is a need to push the retail industry along so that farmers get a better deal?

Mr. Brown: My estimate is that the HLCA package alone might be worth just over £2,000 each to hill farmers in Wales. Clearly, the extent to which they will benefit from the other announcements that I have made today will depend on the mix of the herds. As my hon. Friend will know, I visited Cardiff recently with the previous Secretary of State for Wales to meet representatives of the industry. Those discussions, and the discussions with the present Secretary of State, informed the shape of the package that I have been able to announce today.

Mr. Andrew Welsh: I welcome the Minister's proposals, but, given that agriculture is 50 per cent. more important to the Scottish economy and to Scottish employment than it is to the United Kingdom as a whole, how has that been taken into account in those proposals? How does the total match the depth of the problems? if the problems continue, will the Minister be prepared to act again?

Mr. Brown: I think that the hon. Gentleman could afford to be a little more generous, because Scotland benefits disproportionately from the announcements, as those who follow these matters closely will realise.

Mr. Barry Jones: I thank my right hon. Friend for this timely and excellent package. May I tell him bluntly what farmers in my constituency are saying about him—that he listens well, and that he is accessible and most courteous? However, will he state the total round sum that is coming to Wales? Does he acknowledge that there are special difficulties for sheepmeat and beef producers on the hilltops and hillsides of Wales? How does this timely package help the family farm which demands so much hard work but often makes so little profit?

Mr. Brown: I estimate that the announcement is worth just over £21 million to Wales alone. That is a significant package of extra moneys for Wales. I thank my hon. Friend for his kind remarks about how that will be warmly welcomed by the farmers to whom he has spoken.

Mr. David Maclean: As the Minister has been listening to farmers, he knows that they will be grateful for the package. What does he say to those farmers who believe that, had the Department—perhaps not the Minister himself—acted earlier, they could have obtained £818 million in agrimonetary compensation? What does he say to those farmers who point out that the £120 million package is worth while, but that the rise in interest rates on their bank loans since the previous election is exactly £126 million?

Mr. Brown: The idea that there is a huge pile of agrimonetary compensation available for collection in Brussels if only there was the political will to go over and get it and dole it out to farmers is a complete myth. That is not how it works, as the right hon. Gentleman should know, because he was a member of the Government who introduced the Fontainebleau agreement which conditions how such payments are made.

Mr. Paddy Tipping: Will my right hon. Friend confirm that the extra £120 million is essentially designed to meet the short-term crisis? In the mid to long

term, is it not our aim to bring about reforms of the CAP which would lift the landscape and enhance the environment, and, more particularly, bring new investment, new jobs and a new future to the wider rural economy?

Mr. Brown: My hon. Friend is absolutely right. That is why there are two elements to today's announcement. First, I am responding to what farmers told me at the large Blackpool rally. They said, "We need help, Mr. Brown, and we need it now." This package is that help. It is specifically targeted to deal with immediate difficulties. Secondly, in the longer term, I want to engage the whole of the producer side of the industry in a sensible discussion about how we get from where we are to where we all realise we need to be. That means working together co-operatively and finding a way forward to deal with the challenges that are marching towards us at a very fast pace.

Mr. Elfyn Llwyd: I welcome the right hon. Gentleman's statement, and appreciate that it offers a great deal of assistance. Essentially, these measures will assist in the short term, but what steps is his Department taking to tackle the important matter of bringing confidence back into the industry and restoring public confidence in it? I should be much obliged if the Minister could respond to that question.

Mr. Brown: The hon. Gentleman is absolutely right. These measures are targeted on the immediate problems. Farmers asked for help now; this is that help. In the longer term, we have to work co-operatively to move away from a CAP structure based on production support payments. We need to move towards a structure in which payments are area-based, transparent and specific, and which sets the framework within which private sector businesses can work out how they are going to operate and generate a sufficient return on capital and sufficient earnings for those working in the industry to make it worth while. The Government stand ready to help with that.

Mr. Peter L. Pike: Does my right hon. Friend accept that, when dealing with difficult farmland such as that in the Pennines, we have to consider the environment and the landscape balance as well as agriculture, as in many cases agriculture will not be viable there? We do not want the Pennines to be full of wind farms, which seem to be the only commercially viable option for many farmers at the moment.

Mr. Brown: I strongly agree with my hon. Friend. That is why I am working very hard to try to reshape the CAP so that payments are specific and transparent, and are linked to environmental measures such as protecting the very beautiful area to which my hon. Friend referred.

Mr. Tony Baldry: The Minister said, quite fairly, that this welcome package targets the immediate problems. He also said that, in the longer term, he wished to reform the CAP. However, in between, there is still the problem of the very strong pound. What signal is the Minister sending to the industry on how the Government will tackle that problem in the foreseeable future, as it will not go away? How are bank managers and others to


envisage a future for the industry if there are no clear signals from the Government as to how, in the medium term, they will deal with the strong pound and its impact on agriculture?

Mr. Brown: Some people have very short memories. I remember when, under the Conservative Government, interest rates were twice their current level and the value of the pound was falling, which reflects market confidence. The Government's macro-economic strategy is right. To underpin that, I should point out that long-term interest rates are at their lowest level for 30 years.

Mr. Nick Ainger: I, too, congratulate my right hon. Friend on his statement. There will be a genuine welcome for him in the hillsides of Wales, today and in the coming months.
In relation to the dairy sector, my right hon. Friend will know that there has been a substantial collapse in the price of milk, and that that has exacerbated other problems in the livestock sector. He has told the House that he wants to see further co-operation. May I suggest that he brings together the processors and producers of milk, so that he can bang some heads together? I have never known two parts of the same industry to be so greatly at loggerheads that they are depressing the price.

Mr. Brown: My hon. Friend's suggestion is incredibly tempting, but it would be premature to take it up while the Monopolies and Mergers Commission's inquiry continues.

Mr. Charles Wardle: Welcome though the Minister's statement will be, is not the underlying problem of the industry structural, and will not that problem be resolved only if he proves to be successful in CAP reform? Specifically, what does his statement do for the few surviving hop growers in East Sussex? More generally, does he accept that there is concern on the Conservative Benches for hard-pressed farmers and growers, and for consumers, as food in British supermarkets continues to be among the most expensive in the world?

Mr. Brown: We all look forward to the report of the OFT's investigation into supermarket pricing. As a student, I used to pick hops, so I know something about it from the labourer's point of view. Changes in the way in which beer is produced probably have more influence on the growing of hops than anything done by my Ministry. I stand ready to help where I properly can, but I will not distort markets so that people engage in economic activity that they would not otherwise undertake.

Mr. Alan W. Williams: I welcome the package that my right hon. Friend has announced, which will bring £2,000 for each farmer in less-favoured areas. That is not as much as they have lost, but it is none the less a significant help. Does my right hon. Friend agree that a key issue over the next two or three years will be the rebuilding of the economies of south-east Asia and Russia so that they can take our food exports? There are food shortages in Russia, so will

my right hon. Friend enthusiastically press the European Commission to help with packages of food aid in the coming months, both to help poverty in Russia, and to deal with surpluses from our own markets?

Mr. Brown: The reopening of credit lines so that some supply can enter Russia would be a sensible way forward on humanitarian aid for Russia. An enormous amount of food was being sold to Russia, and the Russians will be in for a very difficult time if we do not find some way in which to restore their markets. I welcome my hon. Friend's other points.

Sir Robert Smith: Any positive move by the Minister will be welcomed by farmers in my constituency as a step in the right direction and as an improvement on past rhetoric. Farmers have financial burdens and they are struggling to reduce their losses, but the frustrations of the bureaucracy that has built up around farming—once an activity that involved working out and about in the environment—are becoming worse.
The farming community is subject to almost draconian penalties for the slightest slip of a pen, but ministerial errors—not by current Ministers—that delay payments or cause disruptions seem not to carry any compensation. Will the Minister consider ways in which to reduce the paperwork burden for farmers, and the farmers' sense that penalties are out of proportion to any error?

Mr. Brown: I have asked my Ministry to conduct a review of the information we require from farmers, and of the way in which we require it. That has been done before, but I wanted to take another look in order to satisfy myself that the Ministry is going about information collection in the most rational way possible. That work will continue into December.
I have tried to be specific in what I have said to the farming community, rather than making generalised statements that everything will be all right in three years. I want to say clearly what the Government can provide, and what the public purse will pay for. My vision of the future is a framework within which people may make their own judgments in a free marketplace.

Mr. Mark Todd: I join the general welcome for my right hon. Friend's statement, but will he focus on the second part of it, which announced a thorough-going review of our preparation for Agenda 2000 negotiations? Those preparations should go far beyond the producer side of the industry, as they must also encompass processing, transport, the regulatory environment and—critically—the retail environment, in order to give a total picture of the preparedness of our agricultural sectors for a competitive market.

Mr. Brown: My hon. Friend follows these matters closely, and I am grateful for his informed interest. He understands the significance of the second part of my announcement. It is vital to the United Kingdom industry that we engage in the discussions early, and not just around the Commission's Agenda 2000 proposals. I broadly support those proposals, but broader challenges are marching quickly towards the industry.

Mr. William Cash: Does the Minister accept that the reason why he cannot pay more money to the farmers—to which they are entitled, given their extremely difficult situation over the past few years—is that the rules are dictated by the Maastricht criteria? The question of state aids must be carefully considered, as it seems hardly fair that German miners should receive £6 billion a year in subsidies while UK farmers are entitled only to the fairly minimal, if welcome, amount that he has announced?

Mr. Brown: The framework within which decisions must be made was entirely shaped for the UK by the previous Conservative Government. I am sorry that the hon. Gentleman seems to find it so bewildering, but I have to operate within the rules. Fortunately for British farmers, I am able to conduct a sensible and rational discussion with the Commission, and to persuade it to help us. The previous Government could not do that.

Mr. Hilton Dawson: I thank my right hon. Friend for listening and for helping. I also pay tribute to my hon. Friends the Minister of State, the Member for Birmingham, Perry Barr (Mr. Rooker), and the Parliamentary Secretary, the Member for Scunthorpe (Mr. Morley), who have both done a cracking job, particularly in receiving the message from Lancaster and Wyre. Can my right hon. Friend assure me that issues such as the development of producer co-operatives and the revitalisation of small market towns will play a large part in his discussions, so that we can market high-quality local British produce?

Mr. Brown: My hon. Friend is absolutely right on all three points. Local marketing, the ability of local farmers to work co-operatively and the work of my hon. Friends in my ministerial team have all shaped today's announcement. I have not been alone in going out to listen

to farmers as other members of the Government have done that too. I thank my hon. Friend for his welcome for that work.

Mrs. Ann Winterton: On behalf of farmers in Congleton, I welcome the package of measures that the right hon. Gentleman has announced, and his acceptance that the measures are short-term aids, intended to bring a little stability to the industry. May I return, however, to the vexed question of the level playing field, and particularly highlight the import of meat and meat products from countries in which animals are not raised, transported or slaughtered under the same welfare and hygiene standards that apply in the United Kingdom?
Will the Minister undertake to try to win a complete ban on such products? Until then, will he ensure that the public purse bears the high costs of regulation in the UK, such as the meat hygiene regulations and the cattle tracing scheme? Will he ensure that those costs are not transferred to the private sector until a ban is in place?

Mr. Brown: I am invited to be a protectionist rather than a believer in free trade, and to spend public money rather than to save it, as the Opposition usually want me to do.
I agree with the hon. Lady on two things. First, I am grateful for her welcome for the announcement, even if that welcome was qualified. Secondly, she argued that the rules that British producers must obey should be obeyed by others, and I think that she is right. I intend to take a hard look at the matters she raised. However, in my experience, the allegation that the others are cheating while we are not is often made in general, while specific examples are harder to come by. If the hon. Lady knows of any examples of grotesque unfairness in trading, I invite her to pass them on to me, so that I may have them investigated at once.

Several hon. Members: rose—

Mr. Deputy Speaker (Mr. Michael J. Martin): Order. I am sorry to disappoint some hon. Members who wished to speak, but we must move on to the next business.

Orders of the Day — Scotland Bill

[2ND ALLOTTED DAY]

Lords amendments further considered.

Clause 62

PAYMENTS OUT OF THE FUND

Lords amendment: No. 88, in page 27, leave out line 33

The Minister for Home Affairs and Devolution, Scottish Office (Mr. Henry McLeish): I beg to move, That this House agrees with the Lords in the said amendment.

Mr. Deputy Speaker (Mr. Michael J. Martin): With this, it will be convenient to discuss Lords amendments Nos. 89 to 112, 180 to 183 and 291.

Mr. McLeish: The amendments deal with a range of matters concerning finance and the tax-varying power. The main areas covered are accounting arrangements for cross-border public authorities, the independence of the Auditor General for Scotland and financial arrangements for the Registers of Scotland. On the tax-varying powers, the group contains amendments that provide for the reimbursement of expenses involved in administration of the power and a revised definition of "Scottish taxpayer". The other amendments are technical.
The technical amendments ensure that references in the Bill to "enactment" include the Scotland Act itself. Amendments Nos. 88, 89, 99 and 101 cover that point. Amendments Nos. 88, 89 and 99 make consequential amendments to clauses 62, 63 and 66. Amendment No. 186, in an earlier group, provides that references to "enactment" include future enactments and subordinate legislation. Amendment No. 111 therefore removes a redundant provision in clause 75. Amendment No. 103 is partly consequential on the revised definition of "enactment". With amendment No. 96, it restructures and simplifies definitions in clause 66 about "Scottish legislation" and "other legislation".
Government amendments Nos. 90 to 93, 95 to 98, 100 to 102 and 104 are largely technical and designed to clarify the intention of the Bill. The main substantive point concerns cross-border public authorities, which may, by virtue of an order under clause 84, receive part of their income directly from the Scottish Consolidated Fund. In those cases, the Bill's current provisions could well mean dual accounting and dual auditing.
It may be sensible for such bodies to provide only one account with, if necessary, an apportionment to Scotland as well, of course, as the other parts of United Kingdom, and for that account to be audited only once by, for example, the Comptroller and Auditor General. Such an arrangement may suit the needs of both this Parliament and the Scottish Parliament, and could be put into place under clause 84. The effect of amendments Nos. 96, 97 and 98 is to make it clear that such agreed arrangements in relation to a cross-border public authority are not duplicated or superseded by the provision that the Parliament is required to make under clause 66.
The other amendments clarify the provisions on the Auditor General for Scotland and the competence of the Parliament to provide for the accountability of persons receiving sums derived from the Scottish Consolidated Fund, even where those sums are used for functions in relation to reserved matters.

Dr. Liam Fox: It seems a very long time since we started this Bill. We have finally got to the final day, and I imagine that a couple of bottles may be broken open this evening. I look forward to the Minister's invitation, given the extortionate salaries that exist under this Government.
The Minister briefly alluded to amendments Nos. 90 and 93, which remove the term "independent" from auditors other than the Auditor General for Scotland who may be asked to examine expenditure made by the Scottish Executive or other public bodies in Scotland. Does that mean that an audit could be conducted in-house and so not independently of the Scottish Executive? I hate to bring a discordant note to the final day of the Bill, but the accounting methods of some Labour councils in Scotland have left much to be desired. We want an assurance that this is not simply a way of allowing previously independent procedures to be done in-house.
Amendment No. 91 removes the words
or by the Scottish Ministers",
when defining the functions of the Auditor General for Scotland in respect of investigating the economy, efficiency and effectiveness of spending by others paid out of the Consolidated Fund. In other words, those who are paid directly from it can be audited, but those who are paid from it via a Scottish Minister need not be. Why is such a watering down of the comprehensive range of powers available to the auditor necessary? This is a change from what was originally in the Bill. We have a right to ask why it is needed.
Will the Minister say more about amendments Nos. 106 to 108 on existing debt? Some parts of the Bill defy attempts to get to the bottom of the amendments. With the best will in the world, I require the Minister to make this clear so that we know what is intended.
It is a particular joy at the end of the Bill to be able to welcome amendments tabled by the Government. Amendments Nos. 109 and 110 on tax-varying powers fall into that category. We are delighted that the Government have accepted that there was a serious anomaly in the practical implementation of those powers. We welcome the U-turn because we welcome sinners who repent at any time, even on the final day of an 18-month marathon.
The amendments change the definition of what constitutes a day's residency in Scotland for tax purposes. In the original Bill, a person was deemed to be resident in Scotland for tax purposes if he was in Scotland at the beginning or end of the day. That would have resulted in an anomaly for someone who worked for a financial service company in Edinburgh and who lived there, but spent the week working in London, who got the plane to Heathrow on Monday morning, stayed in London during the week and flew back on Friday evening. Because he spent part of Monday and Friday in Scotland, he would have been deemed to have been in Scotland for four days of out of seven and so liable to pay tax. That was a ridiculous anomaly, and I am delighted that the Government decided to remove it.


There are still anomalies in the tax definitions. Some of the most pertinent are in clause 71 and concern definitions of principal home, place of residence and main place of residence that have not been used before in United Kingdom tax legislation. What discussions has the Scottish Office had with the Treasury on those definitions? For example, an employee of a Scottish company who has a house in Edinburgh, but is seconded to London for a year where he stays in a rented flat would be considered a Scottish taxpayer because he has a principal home in Edinburgh even though he performs no employment duties in Scotland for an entire year. What constitutes a place under this legislation? That is not contained in UK tax law. Does it include hotel rooms, company flats, train compartments, the cabs of heavy goods vehicles or oil rigs? We would welcome clarification.
I would like the Minister to clarify two other points. Under the national tax rules relating to UK residents, anyone resident in the United Kingdom for any part of the year is resident for the whole year and liable to UK tax on the full income, even if he leaves the UK to live abroad for part of the year. By concession, the tax yield is split and income arising after departure is not in practice subject to tax. It is not clear whether the split-year concession will apply to Scottish tax if a Scottish taxpayer moves to England part way through the year.
The Minister mentioned cross-border authorities but on cross-border commuters, will a person who is resident in England who works in Scotland every day and returns home at night be not liable to Scottish tax because he will not have spent any days in Scotland according to the new definition? His work mates who live in Scotland will be liable. If English residents work night shifts, they will be liable to Scottish tax because technically they will be present in Scotland every day. How will those and other anomalies be ironed out? With some of the other problems that we mentioned earlier, they introduce unnecessarily discordant notes into an improved and rewritten part of the Bill.

Mr. Tam Dalyell: I know, as others do, that the Law Society has had discussions with the Scottish Office and its lawyers on the issue and range of definitions. May we have a brief assurance from my hon. Friend the Minister that the Law Society is reasonably satisfied—I cannot say completely satisfied because no one is ever completely satisfied on these matters—with the answers that have been given, or can we anticipate that there will be great difficulty in the courts when the matters come to be tested, as undoubtedly they will?

Mr. McLeish: Let me first deal with the point raised by my hon. Friend the Member for Linlithgow (Mr. Dalyell) about discussions with the Law Society of Scotland. The Law Society has been involved in every step of very productive discussions and is satisfied with the progress that is being made. However, as I shall explain to the hon. Member for Woodspring (Dr. Fox) in a moment, the discussions are on-going and the Law Society will continue to be involved. At present, the Law Society is satisfied and I can reassure my hon. Friend that any issues before the Confederation of British Industry, the Law Society and ourselves will continue to be discussed at every opportunity.
I now return to some of the main concerns that have been raised this evening. Amendments Nos. 90, 91, 92 and 93 concern the Auditor General for Scotland. Let me briefly explain their implications. Amendments Nos. 90 and 91 are consequential to amendments Nos. 95 and 92 respectively.
The amended subsection proposed in amendment No. 95 provides for the independence of persons appointed by the Auditor General for Scotland to undertake audits or value-for-money studies.
Amendment No. 92 is technical. It clarifies that the Parliament is able to legislate for the accounting and auditing arrangements of bodies receiving money indirectly from the Scottish Consolidated Fund. Such bodies might include non-departmental public bodies funded by a grant from the Scottish Ministers. This makes the words
or by the Scottish Ministers
in clause 66(2)(d) unnecessary. The Parliament should be able to make accounting and auditing provisions even if the bodies' functions include reserved matters.
That point is what the provision is intended to make clear. Clause 66 already makes it clear in relation to bodies such as the Scottish Ministers and the Lord Advocate, to whom sums are voted directly out of the Scottish Consolidated Fund, by requiring the Parliament to legislate for their accountability. Of course the Parliament can legislate to provide for the accountability of persons and bodies, whether or not they receive funds derived from the Scottish Consolidated Fund, where the funding of those persons and bodies is otherwise within the competence of the Parliament.
Amendment No. 93 clarifies that the Auditor General for Scotland will be an individual, natural person and cannot be a corporate body or even a group of individuals. While on its own, the amendment might seem to remove the requirement for the Auditor General to be independent, this very important requirement is now catered for in the new subsection (6) proposed in amendment No. 95. That should give the hon. Gentleman the reassurance that he requires about the absolute independence of the Auditor General.
Amendment No. 95 clarifies the independence of the Auditor General for Scotland and of persons appointed by him. The sole exception is that the new subsection (6A) of clause 66 would allow the Parliament to provide for the direction of the Auditor General in relation to the preparation of his own accounts. In other words, the Parliament could provide for the Auditor General's accounts to be prepared in a particular format and in a particular manner.
In all other respects, the Auditor General will be free from the direction and control of any Member either of the Parliament or of the Executive, and any persons appointed by him—for example, firms of accountants—will be similarly free of such direction or control when they are undertaking audit or value studies of the Executive or its subsidiary bodies.
The other points raised were in relation to amendments Nos. 105 to 108, which are also technical amendments. Their purpose is to allow provision to be made to ensure that the outstanding debt owed by the Registers of Scotland trading fund to the national loans fund is repaid after devolution when the Registers of Scotland becomes part of the Scottish Administration.


For further clarification, the keeper of the Registers of Scotland is responsible for maintaining various registers, the main ones being the land register and register of sasines in which titles to land and other heritable property are registered. He exercises these functions through the Registers of Scotland Executive Agency which operates as a trading fund under the existing trading fund legislation. That legislation will cease to apply to the Registers of Scotland when it ceases to be a UK Government Department and becomes part of the Scottish Administration on devolution. This would leave the outstanding debt owed by the trading fund to the national loans fund somewhat in limbo.
The amendments will enable the Secretary of State to order that the existing debt which is deemed to be owed by the trading fund to the national loans fund should be treated as an advance from the Secretary of State to the Scottish Ministers. The amount is just over £5 million. The Scottish Ministers will have to continue to repay the debt on the existing terms and conditions; and the Secretary of State will pay the proceeds into the national loans fund. That will ensure that the outstanding debt can continue to be repaid to the fund. I am sure that that very simple clarification will suffice to answer the hon. Member for Woodspring.
Of course it will be for the Parliament to decide on the permanent financial regime for the Scottish Administration, including the Registers of Scotland, and the current review of the registers' operations will assist both them and the incoming Executive in doing so. In the transitional period, we want to ensure that the registers can continue to operate broadly as now.
5.45 pm
I now turn to the questions that the hon. Member for Woodspring asked about tax. Again, he was largely complimentary that the Government had clarified an important matter that was raised in the House previously. I also refer to a point that was raised by my hon. Friend the Member for Linlithgow.
There have been good discussions with representatives of the Law Society of Scotland, the Confederation of British Industry and the Institute of Chartered Accountants in Scotland. Following debate in Committee in another place, my noble Friend Lord Sewel, the Minister for Agriculture, gave undertakings to look again at the drafting of clause 71, and a useful meeting with the representatives of the three bodies concerned took place on 21 October. Proposals for basing the definition of a Scottish taxpayer on the concept of residence were discussed. While there were a number of differing views around the table, there was recognition that applying the concept of residence in this context could give rise to some very serious anomalies, which had been raised previously in the House.
There was, however, also a general acceptance that most of the difficult cases that had been identified could be removed or substantially diminished if the Government were to amend the definition of a "day spent in Scotland", so as to remove the double counting which can arise under the current provision in clause 71(4)(a).
That provision says that a day spent in Scotland means any day in which a person is in Scotland at the beginning or end of the day. It was pointed out that, for example, a

lorry driver who spent 92 non-consecutive nights in Scotland in his cab could qualify as a Scottish taxpayer because of the double counting. I am pleased to say that the Government have listened to those concerns and amendments Nos. 109 and 110 address precisely this issue. They will ensure that if a person is in Scotland at midnight, he will only clock up one day spent in Scotland. Therefore, assuming that a person spends the entire year in the UK, he would have to spend 183 nights in Scotland before qualifying as a Scottish taxpayer. The three organisations involved were content with the amendments on the basis that they substantially address their concerns about clause 71 and I hope that the House will agree.
In reply to the hon. Gentleman's final points, the Scottish Office is working very closely with the Inland Revenue and the Treasury on tax powers, which will continue until the infrastructure is in place. Any outstanding issues will not only be discussed by the Scottish Office, the Treasury and the Inland Revenue, but will involve the organisations referred to by the hon. Member for Woodspring and by my hon. Friend the Member for Linlithgow. I hope that I have adequately responded to the concerns that have been expressed.

Dr. Fox: I am grateful to the Minister. On his final point, which is a matter of some concern, I raised three terms: principal home, place of residence and main place of residence. On-going discussions with the Treasury will have to be structured as any change in UK tax law in respect of those definitions will obviously have an impact on Scottish taxpayers for UK taxes. Is this one of the areas where the Government intend to have a concordat? Will there be a formal mechanism of discussion and if so when might we see it?

Mr. McLeish: The answer is, no, there will not be such a mechanism in respect of those issues. In the circumstances, I shall assure the hon. Gentleman first, that the discussions, both those between the Treasury, the Scottish Office and the Inland Revenue and those with the key organisations I have mentioned, are on-going; and, secondly, that I shall write to him and other Opposition leaders detailing the current state of play on the matters that have been raised. I am sure that the contents of that correspondence will reassure the House that everything possible is being done to ensure a smooth transition to the infrastructure required for the new tax-varying power.

Mrs. Eleanor Laing: May I ask the Minister for further clarification on a few points? Amendments Nos. 90 and 93 relate to the audit of expenditure by the Scottish Executive. I am sure that the Minister will agree that it is an extremely important point of principle that the Auditor General and anyone carrying out an audit should not only be independent, but be seen to be independent. In answer to my hon. Friend the Member for Woodspring (Dr. Fox), the Minister said that he considered that those matters were dealt with in amendment No. 95 and new subsection (6), but I do not think that they clarify the point. Therefore, I ask the Minister for an assurance that independence is assured for anyone who carries out an audit in those terms.
On amendment No. 106 and the question of who pays for the general register of sasines and the land register, is the Minister saying that it will certainly be the Scottish taxpayer who pays directly, rather than the matter being


paid for out of national taxation; or is the effect of his answer that they will still be paid for out of national taxation, but accounted for in a different way so that they appear to be taken account of in the Scottish block?
On amendments Nos. 109 and 110, it is good to see that the Government have taken account of some of the points that Conservative Members have insisted are anomalous since the beginning of the Bill's passage. Many matters have caused us to be concerned that, subsequent to the enactment of the legislation, the Parliament would be unable to operate because of the in-built anomalies. I hope that the Minister will pay tribute to the work done in another place, where the anomalies have been smoothed out. Many times when we raised such anomalies in this place, the Government ignored us. I hope that the Minister will commend the work of the other place, which has been extremely valuable, although I do not expect him to go so far as to say that he hopes that the other place will continue in its present form. If the work had not been done in the other place, the Bill would not work.

Mr. Deputy Speaker: Order. I did not want to stop the hon. Lady while she was in full flow, but I should point out that we are discussing Lords amendments, not the Bill in its entirety.

Mr. Robert Syms: I intend to make only a brief speech, dealing mainly with amendments Nos. 109 and 110. I welcome the amendments, because they clarify points raised in earlier debates. I was interested in the Minister's comments about a person having to be in Scotland for 183 days at midnight before qualifying for taxation. How are tax inspectors to police that provision? In addition, Deloitte and Touche has raised a point about split-year concessions, which are possible under United Kingdom tax law. How would that be applied to Scotland? The clarification provided by amendments Nos. 109 and 110 is welcome because the Bill contained major problems.
To re-emphasise what my hon. Friend the Member for Epping Forest (Mrs. Laing) said about audit, I am a little worried about the term "independent" being removed, because its presence would strengthen the power of an auditor. To remove it might well weaken the hand of the person doing the audit and strengthen that of the Executive. I am therefore a little wary of amendments Nos. 90 to 93, and I should like a little more reassurance from the Minister.

Mr. McLeish: On the last point, the hon. Gentleman has my total reassurance. As the note in my hand says—it is more generous than the official advice—the removal of the word "independent" is an illusion. Amendment No. 95 covers it entirely.
The members of the consultative steering group have been determined to build on the auditing procedures used in this House. Hon. Members will find that a combination of the legislation, which is tough, and the work of the steering group, which is putting flesh on the bones, satisfies them that the issues are being taken seriously. Independence means independence. I hope that that also covers the first point raised by the hon. Member for

Epping Forest (Mrs. Laing). The amendments are technical, but the main principle behind them is not a technicality—independence must be guaranteed.
The adjustment in respect of the register is, in a sense, a technical one in terms of debt and the loan fund. The important point is that fees pay for the whole amount, so it does not fall as a burden either on the taxpayers of England, Wales and Northern Ireland, or on those of Scotland. That should clarify the hon. Lady's point.
The other issues raised relate to amendments Nos. 109 and 110. The amendments have clarified and helped to resolve a problem that was troubling many hon. Members, which is why the Government took it seriously. On the other hand, many of the comments made about taxation have been unnecessary—to describe them as distorted or exaggerated would be going too far. They have been taken care of in the discussions with the Inland Revenue, the Treasury and the expert organisations to which I referred. We do not foresee any problems arising, because we have a great body of UK tax legislation and the experts are working with the Scottish Office to ensure a smooth transition from the current position to the implementation of the tax-varying power, if the Parliament decides to use it after the elections on 6 May.

Lords amendment agreed to.

Lords amendments Nos. 89 to 112 agreed to [some with Special Entry].

Clause 83

CROSS-BORDER PUBLIC AUTHORITIES: INITIAL STATUS

Lords amendment: No. 113, in page 39, line 32, leave out ("sections 106, 107 and 108") and insert ("section 106")

Mr. McLeish: I beg to move, That this House agrees with the Lords in the said amendment.

Mr. Deputy Speaker: With this, it will be convenient to discuss Lords amendments Nos. 114 to 118.

Mr. McLeish: This is a group of technical amendments, which is designed to ensure that clauses 83 to 85 make appropriate provision for cross-border public authorities—that is, those authorities whose functions cross the reserved-devolved divide and which are designated by an Order in Council under clause 83.
The most important amendments are Nos. 114 and 118, which make it clear that the clause 84 power can modify the application of clauses 83(1) and 52(4), and amendment No. 116, which makes it clear that an order under clause 84 can confer new functions. The other amendments clarify the wording of the clauses or are consequential to other amendments.

Mr. Oliver Letwin: I do not want to detain the House unduly, but I draw the Minister's attention to amendment No. 113, which he barely mentioned, because it gives rise to an interesting question. I have laboured manfully to understand the import of the amendment and consulted noble Lords who were active in the discussions in another place.
6 pm
First, how does the Minister interpret the difference in clause 83, to which amendment No. 113 refers, between a function
which is specifically exercisable in relation to a cross-border public authority
and a cross-border authority's function? That seems to be the distinction on which amendment No. 113 is relying when it excludes proposed sections 107 and 108 from the second part of clause 83, which relates to the function of such an authority as opposed to the specific exercise of a function in relation to a cross-border public authority. I ask because it is not certain that a court would be clear about the difference. It would be extremely helpful if the Minister could clarify that point.
Secondly, will the Minister cast more light on the connection between the amendments and the draft Cross-Border Public Authorities (Specification) Order, which was introduced in another place? In particular, will he clarify whether all the bodies specified in the order are cross-border in the normal use of that term? If so, how could they have functions to which clauses 107 and 108 ought not to apply, which would be the effect of amendment No. 113?
My final question relates to earlier questions about audit. Who will be responsible for the audit of those authorities and how will that relate to the effect of amendment No. 113, which removes under clause 83 the application of clause 107 to those bodies, given that clause 107 deals specifically with whether moneys paid to those authorities will come out of the Scottish Consolidated Fund?

Mr. McLeish: I should, perhaps, have dealt with those issues before, but, in the interests of brevity, I did not. I shall do so now.
Government amendment No. 113 is a consequential amendment. It removes a reference to proposed sections 107 and 108 in clause 83, which is made redundant by amendment No. 180 to clause 107.
Government amendments Nos. 114 and 118 make it clear that a clause 84 order can modify the application of clauses 83(1) and 52(4) in relation to any cross-border public authority. The bodies in the order referred to by the hon. Member for West Dorset (Mr. Letwin) are cross-border public authorities. That means, for example, that an Order in Council under clause 84 could apply clause 49 in relation to certain ministerial functions in relation to the authority so that those functions would transfer to Scottish Ministers.
Government amendment No. 115 simply makes it clear that an order made under clause 84 may make provision in respect of any particular function of an authority. At present, it could be read as enabling provision to be made only in respect of all the functions of an authority. That would be too restrictive. It is a technical amendment.
Government amendment No. 116 introduces a new paragraph in clause 84(2) to make it clear that an order under it can confer new functions. That might be used, for example, to give the Scottish Ministers a new function of determining the form of accounts of a cross-border public authority.
Government amendment No. 117 is a drafting amendment that simply deletes the redundant words "if any" from clause 84(2)(c). That subsection would then

simply provide that an order under clause 84 would be able to modify the constitution of a cross-border public authority. One cannot amend the constitution of an authority that does not have one.
A draft of the order that would be made under clause 83 was placed in the Library on 29 July. Examples of bodies include the Forestry Commission, the Meat and Livestock Commission, the British Waterways Board and the Intervention Board for Agricultural Produce.
It will be useful if I also put on record an explanation of the context of clause 83. The policy is that it should be for the Scottish Parliament to decide whether cross-border public authorities should continue to operate after devolution as they do at present. The Government envisage, however, that the Scottish Parliament will, generally speaking, wish existing arrangements to continue to operate to take advantage of sharing knowledge and expertise, and of the greater efficiency in the use of resources. The provisions of clauses 83 to 85 give effect to that policy.
Public bodies, Government Departments, office-holders or offices that meet the criteria set out in clause 83(6) may be specified as cross-border public authorities under an Order in Council made under that subsection. If an authority is so specified, certain provisions of the Bill are disapplied in respect of functions of, and functions specifically exercisable in relation to, the authority in question.
The amendments, which are genuinely technical, seek only to improve the Bill passed in the other place and are certainly worthy of support.
The auditing of cross-border public authorities was dealt with in the previous group of amendments. We seek to provide that only one auditing authority need be involved, even though there is a cross-border public body that straddles the reserve devolved function. The reference to auditing and the control of expenditure is clear, but to try to minimise the amount of auditing, it is better that one Parliament takes responsibility for that, rather than having dual auditing.

Mr. Dalyell: I am not trying to be difficult, but those could be complex matters. Is there to be a lead authority, depending on which had or was thought to have the greater share of the business?

Mr. McLeish: Essentially, the order provides for cross-border public authorities to be established. That is important. These are matters for which the Scottish Parliament could in future decide to have its own body, rather than be part of a UK set-up. In the interim, we are trying, first, to avoid dual auditing, which makes sense. Secondly, it could fall to the National Audit Office to perform the task, according to discussions that will take place. Determining the auditing authority will be a matter of common sense.
When we refer to cross-border public authorities, we are referring to the relationship between the United Kingdom and Scotland, but that also takes cognisance of the fact that Northern Ireland and Wales are part of the set-up. The Bill tries to clarify that, so that when we set up bodies, regardless of whether Scotland decides to set up its own bodies, we have a working system that eases the transition to a new system that will work efficiently.

Dr. Fox: What the Minister is saying about avoiding dual auditing is self-evidently sensible. Will there be a


voluntary code of practice? Will he write to us and tell us what consultation the Government have had with what are envisaged to be cross-border bodies and what representations have been made? We might then at least have an idea of the opinions of those groups. Although the amendments are technical, it would be helpful for us to know for future reference what is the Government's thinking on the numbers of groups involved and the balance of opinion on the question of audit.

Mr. McLeish: That is also a fair question. There have been extensive discussions with all the organisations because it is important that we get it right. When clause 84 orders are made in relation to specific bodies, specific auditing requirements will be defined. As to specific orders under clause 84, we want to ensure that each body is taken care of and has its proper procedures established so that there is no confusion as to who is taking the lead role in any particular aspect of a body's work.

Mr. Letwin: The Minister described the amendment as "technical", and I accept that. However, I am not sure that his answer was technical—if it was, it was so technical that I did not understand it. I press him once more on this point for the sake of clarity. Under amendment No. 113, the application of proposed sections 107 and 108 is disapplied when dealing with a function
which is specifically exercisable in relation to a cross-border public authority".
However, proposed sections 107 and 108 are also disapplied when we are dealing not with that but with
any function of such an authority".
I do not understand—and I do not see how a judge will understand—the difference between those two phrases. Could the Minister provide a concrete example of that difference?

Mr. McLeish: I can describe Government amendment No. 113, which is straightforward, but technical. It deletes the reference in clause 83 to the disapplication of clauses 107 and 108 in respect of the functions of cross-border public authorities. The amendment is purely consequential on amendment No. 180, which was debated in the previous group. Amendment No. 180 amends clause 107 to make it clear that the functions of cross-border public authorities are not Scottish functions for the purposes of that clause and clause 108. Therefore, there is no need to continue to disapply clauses 107 and 108 in relation to the functions of cross-border public authorities.

Lords amendment agreed to.

Lords amendments Nos. 114 to 124, 130 and 131 agreed to.

New clause

Lords amendment: No. 132, after clause 91, to insert the following new clause—Human rights—

".—(1) This Act does not enable a person—

(a) to bring any proceedings in a court or tribunal on the ground that an act is incompatible with the Convention rights, or
(b) to rely on any of the Convention rights in any such proceedings,

unless he would be a victim for the purposes of Article 34 of the Convention (within the meaning of the Human Rights Act 1998) if proceedings in respect of the act were brought in the European Court of Human Rights.

(2) Subsection (1) does not apply to the Lord Advocate, the Advocate General, the Attorney General or the Attorney General for Northern Ireland.

(3) This Act does not enable a court or tribunal to award any damages in respect of an act which is incompatible with any of the Convention rights which it could not award if section 8(3) and (4) of the Human Rights Act 1998 applied.

(4) In this section "act" means—

(a) making any legislation,
(b) any other act or failure to act, if it is the act or failure of a member of the Scottish Executive."

Mr. McLeish: I beg to move, That this House agrees with the Lords in the said amendment.

Mr. Deputy Speaker: With this, it will be convenient to take Lords amendments Nos. 133, 134, 136 to 138, 279 to 285, 299 and 300.

Mr. McLeish: Amendment No. 132 deals with the compatibility of the Scotland Bill and the Human Rights Act 1998; amendments Nos. 133 and 134 deal with the legislative power to remedy ultra vires acts; amendments Nos. 136 to 138 would ensure that the appropriate law officer is informed if a court intends to exercise its powers to vary retrospective decisions; amendments Nos. 279 to 283 refer to the definition of devolution issues; amendments Nos. 284 and 285 relate to a number of court procedural issues, including the requirement that intimation be given to the Advocate General and the Lord Advocate if a devolution issue arises in any proceedings; and amendments Nos. 299 and 300 refer to an amendment to the Criminal Procedure (Scotland) Act 1995 to take account of devolution issues.
That group of amendments basically comprises technical ones to clauses 92 and 93 and schedule 6 to ensure that the arrangements for judicial scrutiny are appropriate and work properly. I should remind the House about the systems put in place by the Bill for dealing with legal questions about the extent of the Parliament's powers.
The Bill creates a carefully thought through process for settling questions about the boundaries of the devolution settlement. What we propose will ensure that any legal disputes about those boundaries can be resolved consistently and authoritatively. Schedule 6, in particular, sets out the definition of "devolution issues" and the process for resolving any legal questions that arise about them. The arrangements will provide a solid foundation for developing a common understanding of the detailed extent of the powers of the Parliament and the Scottish Executive as time passes. They form a key part of our proposals.

Mr. Letwin: I draw the Minister's attention to amendment No. 132, which again deals with the question of judges and litigation. My suspicions were aroused slightly when the Minister described it as a technical amendment.
The Opposition strongly welcome what we understand to be the purport of amendment No. 132—I hope that the Minister will confirm whether we are correct. Namely, the amendment would prohibit class actions on behalf of people who are vaguely affected by some act—I am comforted to see the Minister nodding—when it could be argued loosely that they were affected by a convention


right under clause 28. If that is the amendment's intention, we strongly welcome it. I should add in passing that the noble Lord Mackay of Drumadoon first pointed that out in another place, and we all owe him a debt.
Can the Minister clarify his interpretation of the critical term "victim" as it applies in this case? How does he expect that that will relate to a convention right not to be covered under clause 28, given amendment No. 132? Can he also enlighten us about how he envisages individuals pursuing those matters in the courts? Does he expect that it will be possible, nevertheless, to bring an action against Parliament or will it inevitably be against the Executive? If it is against Parliament, does anything in any of the amendments create a constitutional precedent that could have implications for this place?

Mr. John Hayes: Like my hon. Friend the Member for West Dorset (Mr. Letwin), I am prepared to accept the Minister's description of "technical" amendments. However, when he refers to a "technical explanation" of amendments, one might—with the greatest respect to the Minister—read "convoluted".
It might be useful to have some practical examples of the effects of amendment No. 132 and the previous group of amendments. They appear to bring the Bill into line with the Human Rights Act 1998, but it would be useful to have some tangible examples of the difference that they will make, and a fuller explanation thereof. I accept that the amendments are technical and I have no wish to delay the House unnecessarily, but we need an explanation, by way of example, of the difference that the amendments will make.

Mr. Dominic Grieve: I do not think that amendment No. 132 is a technical amendment. I believe that it is a fairly important amendment—although I suspect not a controversial one. It seeks to bring the scope of the Bill into line with the Human Rights Act 1998, but I ask the Minister to clarify why this change has been inserted into the legislation at a late stage when we debated the matter at considerable length when it was first brought before the House. It was made quite clear then that there would be the right of challenge under the scope of the human rights convention and the Bill as then drafted. That does not appear to me to be a technical matter. The amendment introduces a considerable change—albeit a change that is in line with the House's intentions when the matter was first brought before us. I seek clarification on that point because it is important that the two pieces of legislation should match up correctly.

Mrs. Laing: I agree with my hon. Friend the Member for Beaconsfield (Mr. Grieve) that this is a late stage for the Government to introduce an amendment that the Minister describes as a "key part" of their proposals. If they are so important, why have we not examined those matters before? They refer to the way in which the proceedings of the Scottish Parliament coincide with or work alongside the proceedings of not only this Parliament but other quasi-judicial and quasi-parliamentary bodies—of which there seems to be

an increasing number—to which we are affiliated or connected in some way. The amendment relates to important parts of the Human Rights Act 1998, which we scrutinised and considered in this place for many hours. I do not believe that I am being unduly critical by asking the Minister to explain why, if the amendments are a key part of the Government's proposals, they are being proposed now.
It is also a matter of concern that the amendments are described as technical ones. Given that the amendments cover page after page, and if they are technical, is the Minister admitting that many of the points that Conservative Members raised when the clauses were debated in Committee had been overlooked at the time and have had to be considered since?

Mr. Deputy Speaker: We cannot go into the history of the Bill. The motion before us asks whether we agree with the Lords in their amendment. It is a question of agreeing or disagreeing, not wondering why we got here.

Mrs. Laing: I was seeking to clarify some points about the amendments so that I could consider whether we should agree or disagree with the Lords amendments. Thank you for your advice, Mr. Deputy Speaker.

Mr. Hayes: It would help those with less acute minds than your own, Mr. Deputy Speaker, if the Minister would clarify the point by citing an example. We accept that the amendments are technical, but we should be grateful if the Minister illustrated that by citing an example. My hon. Friend the Member for West Dorset asked for examples when we debated the previous group of amendments; he did not get them. By providing practical examples, perhaps the Minister will satisfy those of us who have reservations about the interface between the two pieces of legislation.

Mrs. Laing: I thank my hon. Friend for reminding me of that point, which I should have made. I am sure that the Minister took the note of my hon. Friend's observation.
Once again, I seek clarification to enable us to consider whether the clauses have been properly scrutinised by the House before we can decide whether to agree or disagree with the Lords amendment.

Mr. McLeish: Setting aside the bit of melodrama at the end of the hon. Lady's speech, I point out that our aim is consistency. The matter is technical. The amendments have been debated; they make sense, and we ask the House to support them.
Technically, the Scottish Parliament will be a public authority under the Human Rights Act 1998, but in most cases we would expect the Executive to be the subject of any actions on that. Government amendment No. 132 ensures that the Scotland Bill and the Human Rights Act 1998 are consistent in terms of title and interest and the award of damages. Only those with title and interest—that is, Law Officers or anyone who would be a victim in terms of section 7(6) of the Human Rights Act 1998—could bring proceedings about the alleged contravention of the convention rights, about whether an action is incompatible with those convention rights.
It is intended to restrict the members of the public who can mount a challenge involving such questions to those who can bring proceedings against the public authority


under section 7(7) of the Human Rights Act 1998. That ensures consistency between the Scotland Bill and the Human Rights Act 1998 about who can bring proceedings. Scots law would probably already have the effect that only such victims would have had title and interest. We are making a straightforward attempt to achieve consistency.
Hon. Members asked for examples. I should like to respond fully and give some illustrations, but the key points are that the amendment is technical, that it makes sense, and that there should be no suspicion that the matter has not been properly considered. The amendment will improve the Bill; that is the purpose of all the amendments that we are discussing tonight.

Lords amendment agreed to.

Lords amendments Nos. 133 to 138 agreed to.

Clause 95

POWER TO MAKE PROVISION CONSEQUENTIAL ON ACTS OF THE SCOTTISH PARLIAMENT.

Lords amendment: No. 139, in page 45, line 4, at end insert

("or made by legislation mentioned in subsection (2).

(2) The legislation is subordinate legislation under an Act of Parliament made by—

(a) a member of the Scottish Executive,
(b) a Scottish public authority with mixed functions or no reserved functions, or
(c) any other person (not being a Minister of the Crown) if the function of making the legislation is exercisable within devolved competence.")

Mr. McLeish: I beg to move, That this House agrees with the Lords in the said amendment.

Mr. Deputy Speaker: With this, it will be convenient to discuss Lords amendments Nos. 140 to 146, 152, 157, 158, 160 to 169, 174 to 179, 184 and 286, Lords amendment No. 286, and amendment (a) thereto.

Mr. McLeish: I am reluctant to say that the amendments are technical, but we do have a technical amendment to Lords amendment No. 286.
This large group of amendments deals with various powers under the Bill to make subordinate legislation. Among our aims is to clarify the scope of the power to split ministerial functions under clause 97.
We also aim to split quantitative obligations under clause 97. The amendments provide that, where the power in clause 97 is used to split a European Community or international obligation which is expressed in quantitative terms so that part of it can be transferred to Scottish Ministers, the order will not be made unless they have been consulted.
The amendments in the group also ensure that the Secretary of State' s powers of intervention in clause 54 can be used to ensure that the Scottish Ministers' share of a quantitative obligation is met.
The general provisions about subordinate legislation have been redrafted to make them easier to use and to take on board recommendations of the Delegated Powers Scrutiny Committee in another place that subordinate

legislation under the Bill which amends primary legislation should be subject to affirmative resolution procedure.
The amendments also deal with the transfer of property to Scottish Ministers, the Lord Advocate and the Scottish parliamentary corporate body.
Finally, the amendments deal with the making of provision consequential on Acts of the Scottish Parliament.

Dr. Fox: The Minister will be pleased to hear that I accept that most of the amendments in the group are purely technical. However, I shall probe him on one or two areas—not least on Lords amendment No. 146, which is fairly substantial.
My questions mainly concern the quantitative relationship. We could all think of many areas where such a relationship might apply. In such areas, the working relationship between the Westminster Government and the Scottish Parliament—the Scottish Executive—will be extraordinarily important.
By what mechanism will consultation take place? Given that international obligations are involved, and given that quantitative distribution is involved—say environmental examples, such as on carbon dioxide emissions, where Scotland would be expected to play its part in fulfilling Britain's international obligations—how will the process work in practice? Is this to be among the areas where there will be a concordat? Will the matter be set down on paper? Shall we know in advance how it will work? Or will it simply be left to good will?
The Minister says that no Westminster Government would give a quantitative responsibility on an international obligation to the Scottish Parliament without consultation. I believe that it is legitimate to ask what that consultation will consist of. Will it be a full written and clearly delineated consultation exercise, according to a procedure about which we shall know in advance? Or will there simply be a telephone call to say, "By the way, we have agreed that that is what it's going to be; now you have been consulted. That's it. Thank you very much"? There is a world of different between those two extremes.

Mr. Thomas McAvoy (Comptroller of Her Majesty's Household): How could you suggest such a thing?

Dr. Fox: When the hon. Gentleman has spent as long in government as the Conservatives did, he will know how such a situation can come about—although I hope, for the benefit of the rest of us, that he does not gain that experience.
What will the proposals mean? They make a difference. Earlier in the Bill's passage we said that, where there is potential for conflict between Westminster and the Scottish Parliament, we must consider what would happen in a worst-case scenario. I am not being flippant. A conflict might arise if the form of the consultation process had not been set out far enough in advance and we did not know the mechanisms according to which it would occur.
All I want is for the Minister to tell us the Government's thinking. The Secretary of State said that we must consider the worst-case scenario—that is what I


am asking the Minister to do. What would happen if a Westminster Government were putting on to a Scottish Parliament what the Scottish Parliament thought was a disproportionate element of a quantitative international obligation? There does not seem to be a mechanism for resolving disputes. Subsection (4) of amendment No. 146 contains the words
Scottish Ministers have been consulted",
but we know no more about that. The Minister should tell us what that means.
6.30 pm
Amendments Nos. 160 to 169 represent a substantial rewriting of the Bill. We would argue that as a result of work done in another place, there has been a significant improvement in the Bill, compared with the original drafting that came to this House. However, as there has been such substantial rewriting and so many new points have been added, one wonders why that was not in the original Bill presented to the House.
Furthermore, given that substantial rewriting was required for a Bill that received an enormous amount of drafting time, and given that it was done in the Chamber to which those on the Government Front Bench are instinctively hostile, does not that reinforce the case for a revising Chamber? If ever there was such a case, it is made by these 10 amendments. The Government considered that there were so many flaws in the structure of their flagship legislation that they had to go back to the drawing board and draft it again.
It is surely legitimate for us to ask what would happen if this were a piece of Scottish Parliament legislation and there were no revising Chamber. What would the Government do then? In the new, improved form of this section of the Bill, hon. Members on both sides of the House have much to be grateful to the other place for. Without that revising Chamber, what would we have done?

Mr. Dalyell: I realise that we are short of time, but my curiosity overcomes me. Do hon. Members on the Conservative Front Bench want a revising Chamber?

Dr. Fox: In all the previous stages of the Bill we have recognised that the lack of any revision mechanism would be a serious deficit in the procedures of the Scottish Parliament. The hon. Gentleman will know that in the other place we tabled amendments to try to introduce time lags in the Bill as a substitute for a separate revising Chamber, so that those who had doubts about the contents of and procedures in a Bill would have time to make representations. That, of course, has disappeared.
The Minister speaks of the improved drafting of the Bill and the amendments that the Government tabled. The Government could not have done that under the procedures in their own Bill. The irony is not lost on us. Let us hope that the deficiencies do not cause poor legislation to be introduced in the Scottish Parliament.

Mr. Desmond Swayne: I agree with my hon. Friend about the desirability of the revising Chamber and the way in which that is highlighted by the

amendment. No doubt the Minister would reply that the deficiency is made up for by extensive reliance on pre-legislative scrutiny, but that depends heavily on the public and on public and professional bodies doing their work. That is a largely uncharted course and unproven—but I digress.
My question is simple, and it arises from reading the Bill with an untrained mind—certainly not a legal mind. Is it the purpose of the amendment to bring about a formal consultation of Scottish Ministers in matters where the United Kingdom Government will deal with our international obligations?

Mr. Hayes: Will my hon. Friend add to that the implications of the amendment for the relationship between Scottish Ministers and the new constitutional arrangements? We spend a great deal of time speaking about the relationship between this place and the new Parliament, but I am interested in what my hon. Friend and the Minister believe the amendment suggests for the relationship between Scottish Ministers and the new Parliament. Does the amendment affect other aspects of the Bill; and can that be explained during this evening's proceedings?

Mr. Swayne: My hon. Friend anticipates me. I intended to ask the Minister for his views. It is inevitable and desirable that the Scottish Executive should be consulted and its views sought and understood. However, this House will rightly continue to contain a large number of Scottish Members of Parliament, who remain in this place to scrutinise Government activities in those spheres. To what extent does consulting the Scottish Executive have implications for their role in this House?

Mr. James Wallace: I refer to amendment No. 286, which inserts a new schedule in the Bill and sets out certain types of procedure for subordinate legislation. That is a welcome step forward for clarification, but on even a brief reading we find that if paragraph 3 applies, instead of Type F procedure, Type A procedure shall apply, and so on. For further Bills, would flow charts meet statutory requirements? I welcome the efforts that have been made to simplify the legislation, but flow charts might be the ultimate in simplification.

Mr. McLeish: They might lead me to understand the measure more than I do, which could be a hindrance in some circumstances.
I shall deal first with amendment No. 146, then with subordinate legislation and the new schedule in amendment No. 286. Amendment No. 146 amends clause 97 in two ways. First, in the new subsections (4) and (5), it provides that, where the clause 97 power is used to split a European Community or international obligation that is expressed in quantitative terms so that part of it can be transferred to Scottish Office Ministers, the order will not be made unless they have been consulted. That is important. Secondly, new subsection (6) will ensure that the Secretary of State's powers of intervention under clause 54 can be used to ensure that the Scottish Ministers' share of a quantitative international obligation is met.
Examples of international obligations and obligations under European Community law that will fall within the scope of these amendments are likely to include EC


quotas for livestock subsidies, and the United Kingdom's obligations under the Kyoto protocol on climate change and related Community law to achieve certain targets for the reduction of greenhouse gas emissions.
All parts of the UK will be required to meet a fair proportion of such obligations, not least to ensure that unfair burdens are not placed upon business in one area compared to another. Where it is possible for the Scottish Ministers to contribute to the achievement of the obligation through the exercise of their powers, it is obviously right that they should be apportioned a share of the obligation. An order under clause 97 will enable that to be done. The order will be made by a Minister of the United Kingdom Government or by Her Majesty in Council on the advice of such a Minister, and will be subject to procedure at Westminster only.
The amendment sets out the procedure to be pursued. Consultation will be required, but it would be impossible to define at this stage what that will mean. A framework will be defined for such consultation. The final order will be processed in this House.

Dr. Fox: I am less reassured than I was at the beginning. This is an area where there could be litigation over devolution. We need certain information in this debate, not least the minimum definition of consultation that satisfies the legality of the Bill. The Minister says that there will be some form of consultation, but what will that mean? When the matter goes to court, as it surely will, what is the Government's legal advice on what constitutes minimum acceptable consultation under the terms of this part of the Bill?

Mr. McLeish: It is absurd to suggest that we can clarify and define that this evening. The changes that we are suggesting should be set against a background of important European and international obligations. It makes sense that a process should be established that will deal with quantitative obligations. That is the first major point. Obviously the Government will continue to work within the context of the Scotland Act, which I hope the measure will become after this week, and that of the Scottish Office. Our purpose will be to work out specifically what will be involved in consultation. I do not think that it would be appropriate this evening to try to speculate on what, in the Opposition's eyes, inadequacy would be.

Mr. Grieve: I appreciate that what consultation may or may not be is a difficult thing to define. However, it would be helpful if the Minister spelt out the reality of who calls the shots. United Kingdom Ministers will decide, after having consulted, how the quotas will be allocated, and that is the end of the matter. I am sure that he will confirm that to the House.

Mr. McLeish: First, we accept that there is a serious attempt by the Westminster Parliament to discuss obligations with the Holyrood Parliament. However, we have discussed before European Community and international obligations and the need for the Holyrood Parliament to be consistent in its application of these obligations. We are talking about a further situation where we have not qualitative but quantitative considerations. It seems elementary and straightforward that if there is a process of consultation to be defined, it will clearly flow,

as a framework, from the amendment that we shall agree this evening and from the Bill when it is enacted and becomes law.

Mr. Letwin: I must ask the Minister to answer the question that my hon. Friend the Member for Beaconsfield (Mr. Grieve) put in an earlier intervention. Would United Kingdom Ministers, following consultation, lay down what the quotas are to be, and that would be the end of the matter?

Mr. McLeish: That is not what we have said. As for international obligations, Scotland will be able to go much further on the basis of the devolution settlement than Scottish Office Ministers can now. We are saying that we must take international obligations very seriously. Scotland is obliged to implement these obligations. That is not to say that Scotland will want to do something else.
First, we are talking of obligations that have been placed on the United Kingdom, so there must be a process to deal with them. That is elementary. Secondly, if that process is to work, there must be a basis upon which we consult. That is put into the Bill by the technical amendment that we are considering. If a debating point is being made, it will not wash. We know that international obligations are vital and we are ensuring that when we consider quotas, in respect of the environment or anything else, there will be proper discussions between the two Executives in proceeding to implement international obligations. I think that it is very straightforward.

Mr. Dalyell: I hardly expect Ministers to endorse the perspicacity of its choice of individual to do it, but the fact is that Heriot-Watt decided, wisely or unwisely, to ask me to give the Lothian lecture on Friday on the subject of devolution, science and technology and the environment. The Government Whip gives a wry smile but that is the position that I am in.
I am asking for some guidance. Am I wrong in thinking that at the end of the day these delicate questions of quotas—not only fish but carbon dioxide emissions—depend on what the Government must call good sense and good will, and that there is no legal framework on which to allocate responsibilities? We must all hope that the good will is to be found. Is there anything other than good will for deciding these matters?

Mr. McLeish: That is just not true. The 190 hours that we have spent dealing with the Bill have been about creating a legal framework that will enable us to debate and discuss issues and process and implement decisions that are applicable both to Westminster, if that be necessary, and Holyrood. I can reassure my hon. Friend. I shall write to him with the full back-up of the framework with which we are dealing. It is right to say—I shall make what I hope is the final point—that written into the Bill is consultation in respect of European and international obligations. From that will flow the framework that will make that consultation work.

Dr. Fox: I am grateful to the Minister for giving way once again. We agree that there must be a mechanism for dealing with quotas. We also agree that there has to be consultation. However, in the event of disagreement, who makes the final decision about the allocation of quotas within the United Kingdom? On whom will that legal responsibility and power actually fall?

Mr. McLeish: To repeat a point made earlier, I said that such matters would be dealt with in this House after due consultation.
The fact that is missing from Opposition arguments is that we need to have a fixed and agreed position on international and European Community obligations. That means, rightly so, the necessity for dialogue and consultation. Is it too radical to suggest that the Opposition might see that as sensible and straightforward? I repeat again that a framework is outlined in the Bill that will take us forward on these issues. There is nothing terribly surprising before us. However, the Opposition always want to try to recreate a bit of interest about matters that have been discussed during various stages in the other place and in this place. There is nothing dramatic before us this evening. We simply have a consultation process built into an existing clause.

Mr. Grieve: Just when one felt that the debate on the Bill was coming gently to its end, it is interesting how matters are reawakened and we return to the central principles and the difficulties in the operation of this proposed legislation. The Minister says that we are failing to understand the spirit behind the proposed legislation but I understand that spirit very well. I understand also its limitations. It is—[Interruption.] Does the Minister want me to give way to him?

Mr. McLeish: No, I am just breathing.

Mr. Grieve: If we consider the way in which the proposed legislation will operate in practice, it will be a fertile area for dispute. What is said to be consultation is all part of the happy-clappy inclusiveness which the Government serve up to us. Everybody can be happy, clappy and inclusive as long as everyone agrees with the decision that the Government will make.
I fail to see how the consultation process, as it is added in by the amendment, will serve any purpose if it is spelt out statutorily if, ultimately, Ministers in Whitehall will have to take the final decision—under considerable pressure, one may suspect, from the electorate south of the border as much as that north of the border. The debate has served to bring that out.
I am worried not that the Minister has presented the amendment and asked us to approve it but by the slightly mealy-mouthed way in which he tries to avoid spelling out the truth behind the amendment. All these things get dressed up. Instead of telling the House, "This is the position, there is a consultation mechanism but at the end of the day Whitehall Ministers will have to decide how allocations are implemented fairly on a United Kingdom basis", the process is dressed up. At the end of the day it is suggested that by the mechanism that has been put before us those north of the border will have an input on a statutory basis into the way in which the formulae are arrived at. That is not correct.

Mr. Hayes: I am hesitant to interrupt my hon. Friend's Anglo-Catholic sermon. Perhaps the Minister can deal with the issue best by adopting the course that we have asked him to follow when discussing previous groups of amendments and using illustrations. We look for some tangible and practical illustrations of how the process

would work in practice. In my judgment it is all very well to talk about technical amendments but unless we translate them into practicalities, it is rather hard for us to make judgments about them.

Mr. Grieve: I am grateful to my hon. Friend. I am not sure about the Anglo-Catholicism of my speech—it may be Anglo-Scottish for all I know. As I have often said to the Minister, I hope that the legislation works. However, it is incumbent on the Opposition to point out areas in which it may prove to be deficient.

Mr. Syms: The Minister alluded to the proposed subsection (5) under amendment No. 146, which says:
defined by reference to a quantity (whether expressed as an amount, proportion or ratio or otherwise)".
That leaves a lot of room for misunderstanding. Will this matter be set out in a concordat between the Scottish Executive and the Government so that people know the ground rules in respect of areas of policy, or will it be an ad hoc arrangement—

Mr. McLeish: indicated dissent.

Mr. Syms: The Minister shakes his head. That is very important because there might be differences over consultation, not only over what people should be consulted about but over what weight should be given to respective consultations.
The Bill seems to be moving towards some kind of formula whereby people would know where they stand on these issues. I welcome that because it diminishes the potential for disputes. It would be extremely helpful if the Minister would reassure us that that matter will be negotiated between the Scottish Assembly and the Government.

Mr. McLeish: I can give the hon. Member for Poole (Mr. Syms) total reassurance on an extremely well made point.

Lords amendment agreed to.

Lords amendments Nos. 140 to 152 agreed to [some with Special Entry].

Clause 100

REGULATION OF TWEED AND ESK FISHERIES

Lords amendment: No. 153, in page 46, leave out lines 12 and 13 and insert

("or in connection with the conservation, management and exploitation of salmon, trout, eels and freshwater fish in the Border rivers.

(1A) An Order under subsection (1) may—

(a) exclude the application of section 49 in relation to any Border rivers function,
(b) confer power to make subordinate legislation.

(1B) In particular, provision may be made by such an Order—

(a) conferring any function on a Minister of the Crown, the Scottish Ministers or a public body in relation to the Border rivers,
(b) for any Border rivers function exercisable by any person to be exercisable instead by a person (or another person) mentioned in paragraph (a),


(c) for any Border rivers function exercisable by any person to be exercisable concurrently or jointly with, or with the agreement of or after consultation with, a person (or another person) mentioned in paragraph (a).")

Motion made, and Question proposed, That this House agrees with the Lords in the said amendment.—[Mr. McLeish.]

Mr. Deputy Speaker: With this, it will be convenient to discuss Lords amendments Nos. 154 to 156, 192, 195 and 209.

Mr. A. J. Beith: I shall deal first with amendments Nos. 153 to 156, which cover ground that was debated hastily, under urgent timetable pressure, earlier in the proceedings. We now have from the Lords a much expanded definition compared with the original. However, it is quite complex and I hope that the Minister will explain it a little further.
The essential principle that concerns my constituents and me is that what happens in England should not be decided merely by the Scottish Parliament without reference to my constituents' representations, which will be made through this House. [Interruption.] Those who suggest that adjusting the boundary could solve the problem had better have another look at the atlas, because it would be a fairly substantial boundary adjustment.
If the Scottish Parliament decided to allow Sunday fishing on the River Till—a considerable distance south of the border—which would add to pressure on river stocks, current UK legislation would preclude it. However, if the Scottish Parliament became enthusiastic for such a change, or for such a change on the entire Tweed river system, my constituents would have a legitimate interest in resisting that change.
One could imagine other changes, especially as the clause includes environmental aspects that could be significant. If legislation passed in the Scottish Parliament required the removal of various kinds of cauld that exist on the river system now, landowners would be involved in significant expense. We therefore need to be clear that there would then be an effective process of representation through this Parliament, and that any orders made would have regard to that.
What will be the position on commencement day? Will we have to wait some time for an order under clause 100? If so, what will be the position in the mean time? Will the legislation be accompanied by an immediate order under clause 100, or will there be a significant period in which all those matters will be dealt with by Westminster? I do not understand what happens in that interim period. I should be grateful for the Minister's reassurance on both those points, which affect the property and livelihood of a number of my constituents.
Amendments Nos. 192, 195 and 209 define the "Scottish zone" and an order will subsequently amplify the definition. Will that be done immediately, or will we wait for a long time before we have a definition? What happens if we wait for a long time? Will the order introduced under clause 112(2), to which amendment No. 195 refers, create a new definition of the "Scottish zone" and the boundary between Scotland and England out to sea? That is an intriguing prospect, as nobody has produced a satisfactory definition thus far and there are sharp differences of view as to where that boundary should lie.
Of more immediate significance to my constituents are the references to Scottish fishing boats because many boats fishing from ports in my constituency are registered in Scotland. The effect of these amendments appears to be that the fishing activities of a Scottish-registered boat fishing in the English zone would be regulated by the Scottish Parliament.

Mr. McLeish: indicated assent.

Mr. Beith: The Minister agrees that that is the correct interpretation. It is easy to understand the logic that, if a vessel is registered in Scotland and its owner fishes in Scottish waters, he has accepted obligations to Scotland which make it appropriate that he should be regulated by Scotland. It is slightly more questionable when, for historical or other reasons, a vessel is registered in Scotland and its owner fishes off Seahouses or Amble and is nevertheless regulated wholly by the Scottish Parliament. Has the Minister thought about that; and will he clarify the position?

Dr. Fox: The question of the River Esk was raised in the other place on several occasions. Will the Minister give us some quick clarifications? As the House knows, the management of the River Esk and the right to its source has been claimed by the North West Water authority, the National Rivers Authority, and now the Environment Agency. When it comes to the question of management, exactly how will joint authorities work together, and what will their relative responsibilities be? If the Minister cannot answer now, I should be grateful if he wrote to me explaining exactly how that will be worked out. I hope that the details of this specific example, as opposed to the generic one that we discussed under the previous group of amendments, have been sorted out because it is a very practical issue that has caused many problems.
May I make a plea for anglers? What is the current position in the Bill regarding rod licensing? That matter was raised in the other place and we did not quite get an answer then.
It may be appropriate to finish discussion of this group of amendments and the Bill by asking about a fixed boundary in the Solway Firth. Given that the centre of the channel moves, how will that come about? Are we to attempt to restrict and fix in legislation something that is wholly flexible and movable in nature? Let us hope that our attempt to do that is better than our attempts in some other parts of the Bill.

Mr. Andrew Welsh: I do not want to oppose the amendments, but I should like to congratulate the Minister on his efficient and, as ever, competent dispatch of business.
It is appropriate that consideration of the Bill is ending with amendments relating to the River Sark and the River Tweed. This whole saga started in 1974—that long saga is coming to an end as far as the House is concerned, but for Scotland a new story is beginning.

7 pm

Mr. McLeish: I shall be brief, and I think that I can satisfy all the points that hon. Members have raised.


The right hon. Member for Berwick-upon-Tweed (Mr. Beith) referred to the Tweed and the Esk. Clearly, these will be matters for both Parliaments, so I cannot predict when decisions will be made. There will be no change to the status quo in the interim, and it will be up to the Parliament, along with Westminster, to define its priorities and what changes will be put in place.
In providing for fisheries to be devolved, the Government have always recognised that special arrangements would be required in respect of the two border river systems which straddle the boundary between England and Scotland. It is universally accepted that fisheries management needs to be approached on a whole-river basis. In doing so, however, anyone responsible for fisheries management for a river system which lies in England and Scotland would have to operate under the law of both England and Scotland. It is necessary, therefore, that the laws for regulating fisheries should be same on both sides of the border.
Our task in respect of the Bill, therefore, is to enable both Parliaments to approve such laws, but in a way that ensures that they both approve the same laws. The Government amendments to clause 100 are intended to allow much the same approach to be taken for the two border rivers between Scotland and England. In effect, we are providing for the legal framework for each of those rivers to be established by Orders in Council—which would be prepared by the Fisheries Departments in both countries in co-operation—and for such Orders in Council to be capable of addressing the wide range of tasks involved in fisheries management.
Such Orders in Council should also be flexible enough to offer a wide range of legal mechanisms for fisheries management, much as would be open for each Parliament if it were acting independently. We have to get it right on both sides of the river, and we have established in the Bill a framework for making sure that that is the case.
On sea fisheries, Government amendments Nos. 29, 192, 195, 209 and 252 relate to the devolution of functions in respect of the regulation of sea fishing. In the White Paper "Scotland's Parliament", the Government made clear their intention to devolve functions relating to sea fisheries, subject to suitable co-ordination arrangements to ensure effective discharge of United Kingdom obligations. The devolution of functions exercised at sea has raised for the Bill particular questions which have required careful thought, and the amendments are the product of that further thought. They are intended to ensure effective devolution.
As hon Members will understand, the exercise of ministerial and other functions in relation to the regulation of sea fishing will often mean that functions are being exercised outside Scotland. I should remind the House that, for the purposes of the Bill, Scotland includes the 12-mile territorial seas around Scotland, as provided in clause 112.
When such regulatory functions are exercised outside Scotland, there will need to be clear connections to Scotland to justify action being taken by the Scottish Ministers, and for Scottish courts to recognise jurisdiction in trying offences under Scots law. At sea, however, it is possible to envisage various possible connections to Scotland that might be thought to satisfy the condition "as regards Scotland".
I am conscious that the requirement to implement devolution for sea fisheries has raised a number of problems for legal advisers and, indeed, for United Kingdom Fisheries Ministers, who remain determined to ensure that United Kingdom obligations to manage fisheries under the common fisheries policy are implemented effectively.
Scottish Ministers will be responsible for managing fisheries within the Scottish zone, and for managing Scottish boats. Ministry of Agriculture Ministers will be responsible for managing fisheries within the waters adjacent to England and for managing English boats. The responsibilities of the Welsh and Northern Ireland Ministers and Assemblies will be a matter for their own legislation.
That overlapping set of responsibilities, which arise because of the need to regulate in respect of sea area and fishing boats which may operate in various areas, opens up a possibility that United Kingdom fishing boats may have to operate under the authority of separate licences issued by the fisheries administration. That is not on the horizon at present. The question of the zone is being considered and discussed, and that consideration will be published when that point is reached. Again, decisions on that will be taken by the new Parliament.

Mr. Beith: Do I understand the Minister to have expressed concern at the confusion that could arise if two boats fishing in the same part of English waters happened to be registered one in Scotland and one in England—even though they were both operating out of the same English port—and that the discussions have some time to go to find a satisfactory resolution?

Mr. McLeish: I can confirm that that is the case. This is an area of regulation that we want to get right, and it will be dealt with.
I hope that this is the last time that the Bill is considered by the House. I should respond to the point made by the hon. Member for Woodspring, which showed the spirit in which the Bill has been considered—it has been a highly technical discussion. He referred to the definition of freshwater fisheries management in the Solway firth.
Under the current legal definition of the Esk, the estuarial limit is drawn to include all the inner Solway firth. There are significant salmon fisheries in that part of the firth, and there are distinctive practices and regulations governing those salmon fisheries in England and Scotland. The relevant management bodies have drawn to our attention the fact that significant difficulties arise for enforcement of salmon fisheries regulations as a result of the fluid nature of the boundary between England and Scotland in the Solway firth. That is at the heart of the point that has been made.
The boundary in the Solway firth has, for many purposes, been taken to be the medium filum of the Esk, and then the combined Esk and Eden rivers at low tide. Things are not getting much simpler as we move through the Bill. The topography of the inner Solway firth is such that that channel can move considerably, and it is difficult to demonstrate to the satisfaction of a court where the channel may have been at any point in time. That has been a frustration for enforcement agencies in that area—not for many years, but for many generations.


The good news is that the Government are considering that issue to come up with some final legal resolution to that on-going conundrum.

Dr. Fox: On a point of order, Mr. Deputy Speaker. As this may be the final time that we discuss the Bill, may I, on behalf of the Opposition, thank you, the other Deputy Speakers and, through you, Madam Speaker, for the way in which procedures have been conducted, especially the long stages in the middle of our consideration?
May I also, through the Minister, thank his civil servants for the information with which we were supplied during consideration of the Bill? Without that, it would have been impossible to come forward with constructive opposition. The Bill is much improved, although, as the Minister noted, we have finished with a debate which has been as clear as mud.

Mr. Wallace: Further to that point of order, Mr. Deputy Speaker. May I associate the Liberal Democrats with the remarks of the hon. Member for Woodspring (Dr. Fox)? We thank you, your fellow Deputy Speakers and Madam Speaker, as well as Ministers and officials.
If the Minister and his colleagues show flexibility on the one matter that we have referred back to the other place, this may indeed be the last time that we have to debate the Bill on the Floor of the House.

Mr. Deputy Speaker (Mr. Michael Lord): There is no need for me to comment on those kind points of order.

Lords amendment agreed to.

Lords amendments Nos. 154 to 214, 221 to 236, and 279 to 285 agreed to.

Lords amendment No. 286 and Government amendment (a) thereto agreed to.

Lords amendments Nos. 287 to 297, and 298 to 302 agreed to.

Committee appointed to draw up Reasons to be assigned to the Lords for disagreeing to certain of their amendments: Mr. Desmond Browne, Mr. Stephen Day, Mr. Oliver Letwin, Mrs. Anne McGuire and Mr. Henry McLeish; Mr. Henry McLeish to be the Chairman of the Committee; Three to be the quorum of the Committee.—[Mrs. McGuire.]

To withdraw immediately.

Reasons for disagreeing to certain Lords amendments reported, and agreed to; to be communicated to the Lords.

Orders of the Day — REGIONAL DEVELOPMENT AGENCIES BILL [WAYS AND MEANS]

The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn): I beg to move,
That, for the purposes of any Act resulting from the Regional Development Agencies Bill, it is expedient to authorise the imposition of charges to corporation tax by provisions relating to the taxation of persons who are transferors or transferees in relation to schemes under the Act for the transfer of property, rights or liabilities.
I shall say a few words by way of explanation of the resolution standing in the name of the Financial Secretary. The Bill returned from the other place includes a new clause before clause 38 on corporation tax. The clause is designed to achieve tax neutrality, in that transfers under the Bill should not trigger a charge to tax. The need for ways and means cover arises because the effect of that may, in principle, involve a change in the incidence of tax as between the transferor and the transferee.

Question agreed to.

Question put and agreed to.

Regional Development Agencies Bill

Lords amendments considered.

Clause 2

CONSTITUTION

Lords amendment: No. 1, in page 2, line 4, after ("area,") insert—

("( ) such persons as appear to him to represent the interests of those who live, work or carry on business in rural parts of the agency's area,")

The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn): I beg to move, That this House agrees with the Lords in the said amendment.
The Bill, as we sent it to the other place, provided a general list of the types of people whom the Secretary of State must consult before making an appointment. The list included representatives of local authorities, employers, employees and others. Each heading in the list could be said to encompass rural interests no less than non-rural interests. I can confirm that that is how we have proceeded.
None the less, we are a listening Government, and we have been happy to listen to those who have said that their concern about identifying board members with rural expertise will persist unless the Government put it beyond any doubt that rural interests will be consulted about appointments now and—what seemed to cause most concern—in the future. We were happy to table the amendment in the other place to do just that. I commend the amendment to the House.

Mr. Richard Ottaway: This is a minimalist, grudging amendment that has been brought about by effective Conservative opposition. The Minister says that he wants to place it beyond any doubt that the Government are concerned about rural interests. That has been in doubt for a long time, particularly during the passage of the Bill, and it remains in doubt to this day.
The amendment goes some way towards meeting the Conservative party's point about rural representation. In the other place, a similar amendment was rejected, on the odd ground that it was not appropriate for London. That amendment proposed that a representative who was an expert or had some involvement in rural interests should sit on the development agency.
We accept that this amendment ensures that rural interests will be consulted. Our concern is that pressures grow, and it will be all too easy for urban interests to dominate debates inside the development agency. The amendment does not fully alleviate that concern, but it provides some consultation of rural interests, and as such we are happy to support it.

Mr. Adrian Sanders: The Liberal Democrats are grateful that this matter has been considered and an acceptable form of words has been found. Many of the divisions in our society between urban and rural areas are based on misconceptions. It was important to address this issue, and it has come back before us today. Many people in rural areas will feel more satisfied that their voice will be heard under these new structures.

Mr. Howard Flight: I, too, am relieved that some element of rural representation

has been accepted in the amendment from the other place. As the representative of a rural area in West Sussex, I have two concerns outstanding. The RDAs will, in effect, clearly take the lead on transport policy, and, in practice, may take the lead on structural planning. Those are two key rural issues, and I express the great concern of my constituents from all parties that the powers of county councils, particularly rural county councils, will be emasculated.

Mr. Caborn: I can clarify the position for the hon. Member for Arundel and South Downs (Mr. Flight). Planning and transport powers will not be assigned to regional development agencies.

Lords amendment agreed to.

Clause 25

POWER TO ALTER REGIONS

Lords amendment: No. 2, in page 13, line 20, leave out from ("instrument") to end of line 21 and insert—

("(8) No order shall be made under this section unless a draft of it has been laid before and approved by resolution of each House of Parliament.

(9) An order under this section which would, apart from this subsection, be treated for the purposes of the standing orders of either House of Parliament as a hybrid instrument shall proceed in that House as if it were not such an instrument.")

Mr. Caborn: I beg to move, That this House agrees with the Lords in the said amendment.
Clause 25 deals with the Secretary of State's powers to alter the regions of RDAs by order. In the Bill sent to the other place, the order was to be subject to the negative resolution procedure in both Houses, following consultation with interested parties and, where appropriate, a public inquiry.
Amendment No. 2 provides for orders made under clause 25 to be subject to the affirmative resolution procedure rather than the negative resolution procedure, as provided for in the Bill as drafted. That reflects a recommendation from the House of Lords Delegated Powers Scrutiny Committee, which the Government were content to accept.

Lords amendment agreed to.

Clause 35

POWERS IN RELATION TO THE COMMISSION

Lords amendment: No. 3, in page 16, line 6, at end insert—

("( ) make provision conferring on the Commission functions with respect to the provision of services of any description to regional development agencies,")

Mr. Caborn: I beg to move, That this House agrees with the Lords in the said amendment.

Mr. Deputy Speaker (Mr. Michael Lord): With this it will be convenient to take Lords amendments Nos. 4 to 6.

Mr. Caborn: These amendments are purely technical. Amendments Nos. 3 and 5 allow the Secretary of State to


specify, by order, that English Partnerships and the Rural Development Commission may provide services to the RDAs. We have in mind the provision of IT services in particular, so as to ensure that the expertise and the IT systems of EP and the RDC are available to the RDAs in the early days, to enable them to become established quickly and seamlessly. That is without prejudice to the wishes of the RDAs to consider their long-term strategies.
Amendments Nos. 4 and 6 relate to the making of schemes to transfer staff and assets from EP or the RDC to other public bodies, other than RDAs. Throughout the Bill, transfers of staff and assets from EP, the RDC or Government offices to RDAs are effected by transfer schemes to be approved by the Secretary of State. The amendments make it clear that transfer schemes relating to transfers from EP and RDC to other public bodies can be prepared in a similar way, separate from the orders made under clauses 35 or 37. I commend the amendments to the House.

Lords amendment agreed to.

Lords amendments Nos. 4 to 6 agreed to.

New clause

Lords amendment: No. 7, before clause 38, to insert the following new clause—Corporation tax—
.—(1) The following provisions apply for the purposes of the Corporation Tax Acts.
(2) Any trade or part of a trade transferred under a transfer scheme is to be treated as having been, at the time of its commencement and at all times since that time, a separate trade carried on by the transferee.
(3) Where any trade, or part of a trade, is transferred under a transfer scheme, the trade carried on by the transferee after the date of the transfer is to be treated as the same trade as that which, by virtue of subsection (2), it is treated as having carried on before that date.
(4) All property, rights and liabilities transferred under a transfer scheme are to be treated as having been, at the time when they became vested in the transferor, and at all times since that time, property, rights and liabilities of the transferee.
(5) Anything done, in relation to property, rights and liabilities transferred under a transfer scheme, by the transferor is to be deemed to have been done by the transferee.
(6) Where any property, rights and liabilities transferred under a transfer scheme became vested in the transferor by virtue of a transfer made by a company in which, at the time of the transfer, the transferor held an interest, that interest is to be deemed to have been held at that time by the transferee.
(7) Where any property, rights and liabilities transferred under a transfer scheme became vested in the transferor by virtue of a qualifying transfer, or two or more successive qualifying transfers—

(a) subsection (4) has effect as if the reference to the time when the property, rights and liabilities became vested in the transferor were a reference to the time when they became vested in the original transferor (that is to say, the transferor under the qualifying transfer or, as the case may be, the first of the qualifying transfers), and
(b) if the property, rights and liabilities became vested in the original transferor by virtue of a transfer made by a company in which, at the time of the transfer, the original transferor held an interest, that interest is to be deemed to have been held at that time by the transferee under the transfer scheme.


(8) The previous provisions of this section are subject to such apportionments of unallowed tax losses and of expenditure by reference to which capital allowances may be made as may be specified in the transfer scheme concerned.
(9) This section has effect in relation to accounting periods beginning after the final accounting period.
(10) In this section—
capital allowance" has the same meaning as in the Tax Acts;
final accounting period" means the last complete accounting period of the transferor under the transfer scheme concerned;
qualifying transfer" means a transfer made to one of the following bodies by another such body—

(a) the Development Commission,
(b) the Urban Regeneration Agency,
(c) a regional development agency;

transfer scheme" means—

(a) an order under section 25 which includes provision for the transfer of property, rights or liabilities, and
(b) a scheme under any of sections 34 to 37 for the transfer of property, rights or liabilities;

unallowed tax losses" means any losses, allowances or amounts which, as at the end of the final accounting period, are tax losses within the meaning given by section (2) of the Income and Corporation Taxes Act 1988.

Mr. Caborn: I beg to move, That this House agrees with the Lords in the said amendment.

Mr. Deputy Speaker: I inform the House that this amendment involves privilege.

Mr. Caborn: This is a technical amendment, to ensure that the transfer of assets in schemes made under the Bill is neutral for the purposes of corporation tax. The amendment follows a similar provision contained in the Electricity Act 1989. It provides that the body receiving the assets stands in the shoes of the body from which they have been transferred, so that, for tax purposes, it is as if the assets had not changed hands. That is particularly important in the case of assets transferred to the RDAs from English Partnerships.
Part of English Partnerships' work is to reclaim land for redevelopment. When the land is sold, English Partnerships is liable to pay tax on the proceeds, but can offset against that the cost of reclamation and other work. The amendment will allow an RDA to offset against tax expenditure incurred by English Partnerships before the land was transferred to the RDA. Without it, the RDA would be liable to pay tax on the whole of the increased value of the land, regardless of the fact that much of that would be due to the money that English Partnerships had invested in reclaiming it.
The Corporation Tax Act 1988 provides for similar arrangements in the case of companies in common ownership; but, as "common ownership" is defined there in terms of share capital, we need specific provision in the case of non-departmental public bodies in the common ownership of the Secretary of State.
I commend the amendment to the House.

Lords amendment agreed to [Special Entry].

European Parliamentary Elections Bill

Lords Reasons for insisting on certain of their amendments to which the Commons have disagreed and for disagreeing to the Commons amendment to the Bill in lieu, considered.

Lords Reason:
The Lords insist on their Amendments in page 2, lines 1, 2, 15 and 18, to which the Commons have disagreed, for the following Reason:
Because electors should be able to vote for the individual party candidate of their choice.

The Secretary of State for the Home Department (Mr. Jack Straw): I beg to move, That this House insists on its disagreement with the Lords in their amendments, but does not insist on its amendment in lieu.

Mr. Deputy Speaker (Mr. Michael Lord): With this it will be convenient to discuss the further Government amendment in lieu of the Lords amendments, in page 3, line 46, at end insert—

'Review of electoral system

.—(1) The Secretary of State shall appoint one or more persons—

(a) to review, in accordance with subsection (2), the operation of the system of election provided for by section 3 of the European Parliamentary Elections Act 1978 as substituted by section 1 of this Act, and
(b) to make a report to the Secretary of State within six months from the day of appointment.

(2) The review shall consider, in particular, how the ability of electors to vote for particular persons on a party's list of candidates might affect the results of an election.

(3) The Secretary of State shall carry out his duty under subsection (1) within one month from the date of the first general election to the European Parliament which takes place after the coming into force of section 1.

(4) The Secretary of State shall lay a copy of any report received under subsection (1)(b) before each House of Parliament.'.

Mr. Straw: This is the fourth time that I have had to invite the House to approve the election system for the European parliamentary elections, and the third time that I have had to ask this elected House to override their unelected Lordships.
The arguments against the proposals from the other place are, on their merits, overwhelming; so are the arguments in favour of the closed or simple-list system that we have advanced. The so-called open-list system is not more democratic than the closed-list system, but less democratic. If it were implemented, the result would be anger and incredulity on the part of the electors, directed against those who had instigated it. The electors would feel that an elaborate confidence trick had been played on them. Let me explain why.
The essence of a democratic election system is that those who win the most votes win the most seats: winners win, and losers lose. Under this Conservative system, the winners may lose and the loser may win. The Conservative party claims to support first past the post—it claims to be united on that, if on nothing else. This, however, is not first past the post, but last past the post.

Although the proponents of the system on the Opposition Benches here, and in the other place, understand this only dimly, their system is so flawed that a candidate from, for example, the Conservative party who receives 500,000 votes may not be elected, while a candidate from, say, the Liberal Democrats who receives 350,000 votes may be elected in his place. Is that the result that Opposition Members want? Do they understand the nature of the system that they propose? What explanation would they offer their candidates and their party—let alone the public—if that happened? It is the politics of the absurd; and the fact that the Tory party has chosen this of all propositions on which to manufacture a battle between the Lords and the Commons shows the extent to which good judgment has now departed the leadership of the Conservative party.

Mr. Andrew Lansley: If the Home Secretary considers the arguments in support of the closed list to be so overwhelming, why did 36 Cross-Bench peers vote against the Government, and only one with?

Mr. Straw: I must say, with all due respect to the Cross Benchers in the House of Lords, that most of them are also hereditary peers, and I do not believe that they understand the arguments any more than the Front Benchers.
Let us be clear about this. I tried it to help the hon. Gentleman on the last occasion. When Conservative Members engage in complexities, they usually end up making a complete dog's breakfast of their suggestions, and that is what is happening now. The unavoidable truth of the so-called open system that the Conservatives propose is as I have spelt out: candidates receiving more votes may not be elected, while candidates receiving fewer votes may be elected.

Mr. Lansley: Will the Home Secretary give way again?

Mr. Straw: No.
The Conservatives have synthetically manufactured this battle. What gives the lie to their claims that they are defending some grand democratic principle against a dastardly new Labour scheme is the fact that they, as a Government, were the first to use the closed list. I know that they do not wish to be reminded of that—I have watched them squirm every time we remind them—but the system that I am0 now recommending to the House, for the fourth time, is the same in every particular as the scheme that the Conservatives recommended to this House and the other place in 1996. If the closed-list system is so bad in principle today, why was it not so bad two years ago, when the Conservatives suggested it?
The only excuse to which the Conservatives resort—a threadbare excuse—is that they proposed a closed list for Northern Ireland. What kind of argument is that, especially from a party that was once proud to have "Unionist" as part of its name? The former Prime Minister, the right hon. Member for Huntingdon


(Mr. Major), did not say that Ireland needed the closed-list system because it had particular problems. Speaking of the very same system that we are now discussing, he said:
I believe that this is a fair and balanced system that will produce a representative outcome."—[Official Report, 21 March 1996; Vol. 274, c. 498.]
In Committee on the same Conservative Bill, proposing closed lists, the right hon. Member for Devizes (Mr. Ancram)—the Conservative party's constitutional expert, and its chairman—said:
The strength of the system that we are proposing is that, for the voter, it requires only one cross to be put against one party. We must make sure that the voter understands that when he goes into the polling booth and is faced with the ballot paper. I think that what we are proposing is the best way to achieve that."—[Official Report, 23 April 1996; Vol. 276, c. 283.]

Sir Norman Fowler: The Home Secretary is making a terrible case for his measure—even worse than usual. Does he not concede that the former Prime Minister made it clear that that position was being adopted only in the context of Northern Ireland? [Interruption.] The right hon. Gentleman laughs. Will he not also concede that his Prime Minister, then Leader of the Opposition, said:
As I am sure that the Prime Minister"—
my right hon. Friend the Member for Huntingdon (Mr. Major)—
would agree, the solution on the election process is certainly not ideal "?—[Official Report, 21 March 1996; Vol. 279, c. 499.]

Mr. Straw: If the right hon. Gentleman had bothered to read the debate properly, he would know that one of the reasons why my right hon. Friend said it was that what was proposed was a combination of the single transferable vote and the closed list. We never objected to the closed-list system at that stage, and—this is more to the point, as it is they who are now objecting to it—neither did the right hon. Gentleman and his colleagues.
What the right hon. Member for Devizes said about the strength of the system as it applied to Northern Ireland must also apply to the rest of the United Kingdom. After all, it is the same system. As I said in the House last week, it is extraordinary that the Conservative party should now propose one of the most complicated of the alternatives—leaving aside its other defects—given that one of its many objections to the Jenkins proposal related to its complexity.
If the right hon. Gentleman will not take advice from me, he might be wise to take advice from one or two of his noble Friends, particularly those who are standing for the European Parliament under the closed-list system. There was a fascinating letter in The Daily Telegraph today from Lord Bethell, who was MEP for London North-West until he lost his seat in 1994 under the old first-past-the-post system. He now stands as No. 3 on the Conservatives' closed list, and plainly hopes and expects to be elected. Having gone through a ritual congratulations to the Opposition in the Lords, he said—I quote directly from the letter:
I wonder, though, if the Conservatives want the elections to be fought on the fully 'open list' system. If so, they will run into problems. The open list offers a choice so wide as to be confusing, especially since hardly any of the several hundred candidates whose

names will be put forward have any public profile. Ballot papers will carry 50 or more names. Hardly anyone will know of them. Voters will mark their crosses at random."—[Interruption.]

Mr. Deputy Speaker: Order. Some hon. Member has an electrical device that is sounding off in the Chamber. Madam Speaker takes an extremely strong line on these matters. Members must either ensure that they have properly switched them off, or leave them outside the Chamber.

Mr. Straw: You are right, Mr. Deputy Speaker, to upbraid the Conservative who had failed to turn his pager off. The same thing happened on Second Reading of the Bill on 25 November last year.

Mr. Desmond Swayne: rose—

Mr. Straw: I will give way to the hon. Gentleman when I have finished reading Lord Bethell's excellent letter. Lord Bethell goes on with this sage advice to his party:
A change to the open list will also cause conflict between candidates of the same party, who will be competing as much against their colleagues as against their adversaries. One advantage of the closed list is that in London, for instance—where I hope to stand—all 10 of us Conservatives are in the same 'job lot'. A vote for one is a vote for us all.
I would have thought that, these days, some mechanism that ensures some Conservative unity would be welcome to the Conservative party.

Mr. Swayne: My understanding is that Lord Bethell voted against the Government on the issue, but did the right hon. Gentleman see the article on the opposite page by Daniel Hannan, placed fourth in the list for the south-east? If he did not, I commend it to him.

Mr. Straw: I did read Mr. Hannan's article. I have marked it up and have it here. By the way, although I have a high regard for Mr. Hannan, whom I know, he erred. He said:
In Britain, where democracy preceded parties".
Tories often make the error of believing that the development of representative government that we had in this country over many centuries up to the end of the previous century was democracy; it was not. We did not get around to establishing a properly democratic franchise until this century, so Mr. Hannan, on that key point, is in error.

Mr. Jonathan Sayeed: Did the Home Secretary read Lord Bethell's speech of 12 November at columns 862 and 863? If so, he would have recognised that Lord Bethell was not just speaking against closed lists, but recommending a different system.

Mr. Straw: The hon. Gentleman shows the degree of confusion in the ranks of the Tory party. I have read out what Lord Bethell wrote in The Daily Telegraph today. I assume that, like quite a number of other Conservatives, he now has a touch of the panics. He realises the


considerable problems that will arise to the Conservative party if the leadership of his party and the Conservative Whips in the other place continue this process.

Mrs. Gwyneth Dunwoody: I am listening carefully. I hope that we will not hear too much of Lord Bethell because, although he is a dear man, he once marched around a kibbutz and said solemnly to the young man in charge, "Wouldn't it be better run by private enterprise?" I have never had quite the same faith in his judgment since.

Mr. Straw: None of us will vote for Lord Bethell, even if we are presented with the opportunity to do so, but his words speak for themselves. He makes the point that I have been making to Conservative Members for many months: to have a so-called open list with 50 or more names on the ballot papers, where hardly any of them—says a candidate who is pretty well known himself—is known, will lead to voters marking "their crosses at random".

Mr. John Bercow: I am following the Home Secretary's observations with close interest. Is he aware that Lord Bethell, who is an estimable individual, is also a constituent of mine residing in Brill in the Buckingham constituency? Is he further aware that Lord Bethell is a lifelong opponent of centralism and deeply disapproves of the thoroughly undemocratic, Stalinist fashion in which the Labour party wishes to select its candidate for the European elections?

Mr. Straw: My party is a lifelong opponent of centralism as well. We do not need any lectures about centralism from the Conservative party. Some of us remember when the Conservative party was in power, and the Stalinism of Conservative central office knew no bounds.

Mr. Richard Allan: Does the Home Secretary agree that, under the system that is proposed by the Conservatives in their amendment, the single biggest factor in whether Lord Bethell got elected was whether he was listed as Bethell, Lord or Lord Bethell?

Mr. Straw: That is likely to be the case, but even though Lord Bethell has the advantage of being at the top of the alphabet, a problem from which I have suffered all my life, being near the bottom of the alphabet—look where it has got me—he is firmly against the so-called open list.
The suggestion that the closed list is anathema to our British way of politics is synthetic nonsense. All of us were selected for closed lists—one party, one candidate. That is how it works. A Tory in Sutton Coldfield, a Liberal Democrat in Berwick-upon-Tweed and a Labour supporter in Blackburn have no choice whatever of party candidate. It is take it or leave it. It is no good saying that that is an inherent characteristic of single-member constituencies; it is not. It would be feasible to devise a system for single-member constituencies where each party had to offer two or three candidates, and the voter

separately chose the winning candidate from the winning party. Is that what the Conservative party now wants for Westminster? That is the logic of its position.
As to how the closed-list system works out in practice, although we believe—I have made this clear—that it has inherent advantages over any other variant, we do not suggest that this debate should be Parliament's last word on the subject. It was for that reason that, last week, I moved that there should be inserted in the Bill an amendment stating that a statutory review should be carried out into the new system.
I think that that proposal had general approbation, but questions were raised about the review. One was as to who should conduct it. A second was as to whether the review could deal with the principle of closed lists, as well as their operation.
On the first question, I undertake that there will be consultations with the Opposition parties about who should undertake the review. The amendment makes it clear that, formally, the appointment will be a matter for the Secretary of State, but I recognise that the review will be far better if there is agreement on who should undertake it.

Mrs. Margaret Ewing: May I re-emphasise the issue that I raised last week on the review? Will there be a role for the Scottish Parliament and a Welsh Assembly, because the lists for the European elections are separate? Will there be a determination to ensure that there are representatives of those bodies on that review?

Mr. Straw: I understand the hon. Lady's concern. I undertake to consult her about that. We have not made decisions yet about how many people should conduct the review, but I accept her point that there should be a proper input from Scotland and Wales. I think that the review will have to take place in advance of the formal establishment of the Scottish Parliament and the Welsh Assembly, but I take her point and I hope to meet it.
On the second question, the amendment proposed last week spoke of the "operations" of the new system. I told the House that I took that to include the principle behind the system, but the new Government amendment makes that clear beyond doubt. Subsection (2) states:
The review shall consider, in particular, how the ability of electors to vote for particular persons on a party's list of candidates might affect the results of an election.
Overwhelming though the arguments are on their merits against the open list, and in favour of the closed list, this issue has now gone beyond that. It is now about Lords versus Commons, about whether a Labour Government, elected just 18 months ago with one of the strongest popular mandates this century, should be blocked from meeting one of their promises to the electorate by a Conservative Opposition who suffered their greatest defeat this century. It is about whether democracy should be defeated by aristocracy—by the in-built majority of hereditary Conservative peers appointed to the other place not because of their own merit but because of the accident of their birth.
I think that the public will find it extraordinary that, for a Conservative party seeking to modernise itself for the next century, Tory Whips in the other place are dragging out hereditary peers to stop the Government securing the clearest of manifesto commitments. For Lord Cranborne


to argue—as he did yesterday—that we did not say exactly which list system we would use is to take sophistry to its extremes. It was highly probable that we would use a system used by most voters in the European Union—the closed-list system—and inherently improbable that we would fetch up with the Conservatives' strange alternative of last past the post. Moreover, I have no recollection of any Tory, at any stage during the general election campaign, ever raising the issue—perhaps because fresh in their minds was the memory that they had used the closed-list system in Northern Ireland.
As long ago as 1791, in "The Rights of Man", Tom Paine said:
The idea of hereditary legislators is as inconsistent as that of hereditary judges, as hereditary juries; and as absurd as an hereditary mathematician, or an hereditary wise man; as absurd as an hereditary Poet Laureate.
There is no rule of politics or history stating that political parties are bound to survive, however distinguished may be their past—as is the Tory party's. Last Friday, the Adam Smith Institute and MORI published the results of a detailed survey of the attitudes of young voters—of the so-called "millennial generation"—who will reach the age of 21 around the turn of the century. The survey made dismal reading for the Conservative party. Only 12 per cent.—one in eight—of those questioned said that they would support the Conservative party.
If Conservative Members want some explanation of the reason why they are regarded as irrelevant to Britain's future by so many of those who are Britain's future, they need look no further than the unedifying pantomime of their party's behaviour on the Bill, in which they seek to use an undemocratic and unelected institution that is locked in the 18th century to block the will of the elected House.

Sir Norman Fowler: As the Home Secretary said, this is the fourth time that we have debated the subject. I think that everyone who has listened to our previous debates will think that the Home Secretary's speech today is easily the weakest one on the subject that he has made so far. The most extraordinary claim he has made so far is that there are overwhelming arguments in favour of closed lists. The arguments are so overwhelming that he has failed to convince anyone except Ministers. He has certainly not convinced Labour Back Benchers, the press or the public, which is why he was so glad to move on to the party politics of Commons versus Lords, and to get off the substance of this debate.
The Home Secretary seemed to suggest that there was some type of constitutional problem with the Bill. For the reasons that Lord Shore—who is not a Conservative—gave in the other place when he voted once more against the Government, I believe that that is an exaggerated claim. The point that the Home Secretary avoids is that, if there is a problem, the man who is responsible for the problem is the Home Secretary himself. He chose closed-list voting. He cannot shuffle that responsibility on to anyone else. It is because of his blunder and his mistake that we are debating the issue yet again.
The Home Secretary also cannot claim that he was not warned of the consequences of going down the closed-list route. In the very first speech that he made on the Bill,

12 months ago, on Second Reading, he was challenged directly on closed lists. He was challenged not only by Conservative Members but by Labour Members. The hon. Member for Cannock Chase (Dr. Wright) said quite bluntly:
many of us will not be persuaded by the argument that closed party lists on a regional basis are the right horse for this course.
The hon. Gentleman suggested that it would be appropriate to give the House a choice of proportional systems.
Replying, the Home Secretary said:
Today we are implementing a manifesto commitment on which all Labour Members stood."—[Official Report, 25 November 1997; Vol. 301, c. 807.]
However, the Home Secretary knew as well as we know that Labour Members did not have a manifesto commitment on the closed list. Although they had a commitment to proportional representation in the European election, that is not the issue in this debate.
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I make it clear yet again that Conservative Members would infinitely prefer a first-past-the-post system. Much of this prolonged debate has simply confirmed that belief—which I suspect is shared by my hon. Friends. However, that is not the issue in this debate. The Government have forced through the PR system and forced through regional lists. The only remaining issue is whether the public shall have the right to elect their Members of the European Parliament on a named candidate basis—on an open list—or be confined to voting for only one party on a closed list.

Mr. Ivor Caplin: Will the right hon. Gentleman say whether he accepts the principle that the closed-list system that the House is considering is identical to the systems used in Germany and France?

Sir Norman Fowler: Even if it were identical to the system used in Germany and France, I am not sure where that would take the argument.

Mr. Caplin: It is the same.

Sir Norman Fowler: Where does that take the argument on democracy in the United Kingdom? If the hon. Gentleman wishes to argue that the system advances democracy, I very much hope that he will make a speech on the subject. I very much hope that he will make a speech on it also because we have not heard one Labour Back-Bench speech in favour of closed lists. We have not heard one serious speech by a Labour Back Bencher in favour of the system. Although I am not sure that a speech by the hon. Member for Hove (Mr. Caplin) could meet my definition of a serious one, I look forward to hearing one from him, if and when it comes.

Mr. Straw: The right hon. Gentleman—

Mr. Caplin: He has lost the plot.

Mr. Straw: Yes. The right hon. Gentleman should refresh his memory about the debates on Second Reading. My hon. Friends the Members for Birmingham,


Northfield (Mr. Burden), for Stroud (Mr. Drew), for Wyre Forest (Mr. Lock) and for Brigg and Goole (Mr. Cawsey) all supported the Bill as published, which included closed lists.

Sir Norman Fowler: I now understand why the Home Secretary is such a good lawyer. It is perfectly true that there were such arguments—I have read them—on Second Reading. It is true also that the Home Secretary won for the Bill a majority of votes on Second Reading. However, can he name one Labour Back Bencher who has spoken in favour of the Government's proposals on closed lists? I shall give way to the right hon. Gentleman. The fact is that they all voted, but none of them spoke in favour of closed lists. The Home Secretary is squirming, and he knows that he is squirming. He should perhaps let the debate proceed.
Everyone—regardless of party allegiance—agrees that the closed-list system gives power to the party. It must do that; that is what it is all about. Virtually everyone agrees that, under the system, the Member of the European Parliament will become responsible to the party and not to the public. The whole point of closed lists is to transfer power from the public to the party bosses. However, despite all the arguments, the Home Secretary has persisted in proposing a voting system that has been almost universally condemned in both Houses of Parliament.
As I said, not one Back Bencher—not only in the House, but in the other place—has spoken in the debates of the past two or three weeks in favour of the closed-list system. Even last Thursday, when two or three Labour peers were at last rolled out to support the Government, they were at pains to distinguish their case from the argument on the closed list.
Lord Barnett, in his first sentence in support of the Government, said:
I should make clear that I prefer the open list system.
Lord Richard, also supporting the Government, tackled the problem in a slightly different way. He said:
I am not concerned about the issue of open lists and closed lists".
Lord Evans who, in the previous debate, had been an abstaining rebel, this time voted with the Government, but ended his speech with the warning:
I shall continue to oppose closed lists. I shall take up, through my party's machinery, the absolute necessity of getting rid of the appalling methods we have used to select candidates.
However, he added that that was a matter for future debates, as he sought to explain his change of mind. I watched the debate and was glad to observe from the response that the Lords can spot a bogus reason when they see one.
The debates are positively littered with examples of Labour Members and Labour peers attacking the Government. In the debate to which I just referred—it is only the latest one—Lord Shore, who is not exactly a Conservative peer, said:
The issue is about the open list against the closed list. It is about an open democratic list against a closed party management list. It is about accountability to the electorate, to the voters, against accountability to a party committee".

Lord Stoddart, who was provoked to speak by Lord Barnett, rather against the interests of Lord Barnett and those on the Government Front Bench, said that he had been accused of being a leading Eurosceptic, which he was, but that had nothing to do with his motives. He said:
Indeed, as a leading Euro-sceptic, it would suit me very well to support this legislation because it divides and separates even further the Euro MPs from the electorate … The fact of the matter is that I believe that this legislation is bad because it removes the link between the electorate and the elected."—[Official Report, House of Lords, 12 November 1998; Vol. 594, c. 851-61.]
So far, the argument that the Home Secretary believes is overwhelming does not appear to be going altogether his way. Perhaps the press has been kinder to him. However, the leader in The Times on Saturday does not lead to that conclusion. It said:
The Government should not continue to defend the indefensible. There is almost no Member of either House of Parliament who has any sincere enthusiasm for closed lists. It is not enough to conduct a review of a rotten exercise after it has happened. This could only challenge the legitimacy of those who are elected. Mr. Straw should make the most of the unwanted opportunity that their Lordships have thrust upon him. He should drop this dubious proposal entirely.
That is exactly what the Home Secretary should do. The system that the Home Secretary is proposing is basically without friends. We all know that.
If the Home Secretary wants a constitutional issue, I suggest that he examine the speech made in the House on Tuesday last week by the hon. Member for Wrexham (Dr. Marek). In taking up the argument of another Labour Member, the hon. Member for Walsall, North (Mr. Winnick), who also criticised the closed list and who I see is in his place, the hon. Gentleman said that his hon. Friend had
argued, with good grounds, that there is no majority in favour of the closed-list system in the parliamentary Labour party. Yet, he also argued that the Government would have a large majority tonight. I ask the House to think about that contradiction. If there is no majority in the Labour party, but the system is such that the Whips and the Patronage Secretary can dragoon members through the Lobby—and I admit that I will be dragooned when the time comes—what legitimacy does the elected Chamber have in comparison with the unelected Chamber whose Members may, by and large, vote according to their own judgment on the right course of action for the country?"—[Official Report, 10 November 1998; Vol. 319, c. 226.]
That was a Labour Member speaking only a few days ago, and surely he asked the question that we should be asking.
We are being asked to accept a voting system that next to no one wants, yet the Government are forcing it through against opinion in their own party, against that of the Conservative party and against the vote in the House of Lords. Let us not pretend that it is a great test of the democratic process. The issue is not the House of Lords carrying out its right and proper function, but Labour Whips forcing support for a voting system which the Labour party, left to its own devices, would reject.
As for the Lords, it is certainly true that hereditary peers helped to vote down the Government amendment, but so did Labour peers like Lord Shore and Lord Stoddart and, as my hon. Friend the Member for South Cambridgeshire (Mr. Lansley) pointed out, the vast majority of Cross Benchers. I am no more convinced now than I was before that the votes of some of the Labour placemen who have been put into the House of Lords are in some ways superior to those votes. The Home Secretary will find it very difficult to establish overwhelming support for the Government's proposals.


Even a Liberal Democrat broke ranks last week. Up to now, the Liberal Democrats have exhibited what is, even for them, the most extraordinarily pathetic attitude to the issue. They have argued for the open list but voted for the closed list. That is not being cruel—it is simply a fact. To his great credit, Lord Russell this time voted against the Government. He ignored the threat that he would be sacked from the Liberal Democrat Front Bench. As far as I know, he has not been sacked. Of course, it would have been terrible had it happened, but the Liberal Democrats can no more make up their mind about sacking a spokesman than they can about anything else. In any event, it exposes the terrible sham of the Liberal Democrats in opposition, and can be explained only by their new coalition with the Government.
This is the third time that we have debated the amendment regarding the open list and the Government's opposition to it. The Government's latest amendment makes no concession and is not intended to do so. The Home Secretary does not expect us to be persuaded by a review which, by definition, will take place after the European elections. His arguments are increasingly unconvincing, and the most unconvincing of all is that which he uses about the closed-list system in the exceptional circumstances of Northern Ireland.
I took the trouble to confirm the position in Northern Ireland with my right hon. Friend the Member for Huntingdon, the former Prime Minister. He confirms that when it was used for the election for a deliberative forum in Northern Ireland, it was to meet the special circumstances there, and was so explained. That was not what the Home Secretary said tonight.
My point is confirmed by the statement made by my right hon. Friend the former Prime Minister on 21 March 1996. Speaking of the list system, he said that the solution was "not ideal". He used those words because the then Leader of the Opposition, now the Prime Minister, had began his questioning by saying:
As I am sure that the Prime Minister would agree, the solution on the election process is certainly not ideal".—[Official Report, 21 March 1996; Vol. 274, c. 499.]
Yet it is that "not ideal" voting system that we are now to have for the European election. How does the Prime Minister defend that? Apparently, he says that it is simpler. That shows a deeply patronising attitude to the British electorate. It is saying that it is all rather complex for the public, so the Government will help them or, in fact, decide for them.
I am most unconvinced by the Home Secretary's analogy with the election of Members of Parliament to Westminster. There is a fundamental difference. I leave aside cases in which the public have rejected the candidate in spite of the party label or in which people have resigned the party label to challenge the party, sometimes successfully—for example, Dick Taverne. Most of us in this House regard our first duty as being to the public and to the people who elected us. Under the closed-list system, the representatives' first duty can easily become a duty to the party because it is the party that selected them. That is a fundamental difference.
There is one straightforward issue in this debate. It is the difference between the closed list, under which the public vote not for a candidate but for a party, and the open list, under which the public may choose a named candidate who will represent them. That is the choice we face.
The Home Secretary attacks the House of Lords and the role of a second chamber. He is as unconvincing in those attacks as he is in all his other arguments. He avoids the real criticism that the argument against the system that he has proposed is that it is basically anti-democratic. He cannot raise a flag proclaiming "power to the people" when the system that he proposes will give power to the parties. However, he seeks to do just that.

Mr. Andrew Stunell: Will the right hon. Gentleman give way?

Sir Norman Fowler: No, I will not. I am just finishing. [HON. MEMBERS: "Go on."] Well, I will if they wish it.

Mr. Stunell: I thank the right hon. Gentleman for giving way. At the start of his speech, he said that he infinitely preferred the first-past-the-post system. Does he accept that if he succeeds in retaining that system for the European elections, there will in fact be a closed list for each individual European constituency?

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Sir Norman Fowler: That shows the value of giving way to the hon. Gentleman. I shall learn from that for the future. The hon. Gentleman is a bit slow on the uptake so I shall take him back a little. We are not debating the first-past-the-post system.

Mr. A. J. Beith: Oh yes we are.

Sir Norman Fowler: Oh no we are not. I shall not be rude to the right hon. Gentleman, but he is mistaken. I could put it more strongly than that. 
We are debating what kind of voting system will be used under the type of proportional system that the Government are forcing through. Will we have an open-list system, or a closed-list system? I find the attitude of the hon. Member for Hazel Grove (Mr. Stunell) extraordinary, hypocritical and baffling in every way. He argues for an open-list system, but he will vote tonight for a closed-list system. That is the hypocrisy of the Liberal Democrats. 
The Home Secretary's proposals take power from the electorate, and give power to the party bosses. That is our fundamental criticism of his system. It takes power from local people, and transfers power to the centre. It is no surprise that the Home Secretary's proposals have been almost universally condemned as there is no serious justification for them. For those reasons, the House should reject the Home Secretary's latest amendments.

Mr. Tony Benn: I have not participated previously in debates on this matter. I have abstained until now, and I have not voted for the Bill as I think it a very bad Bill. I hope that I can be acquitted of having any sympathy for the House of Lords. To be invited to disagree with the Lords on any matter is to be tempted to do so, but the arguments against the closed-list system are absolutely overwhelming. Indeed, those arguments are the same as the arguments against the House of Lords itself for its Members all got in on a closed list. The Prime Minister draws up a little closed list, and he puts all its members into the House of Lords. If we get rid of the


hereditary peers, which I would welcome, we shall have nothing but a closed list in the Lords. They will all be the Prime Minister's friends. My objection to the Bill is, therefore, the same as my objection to the House of Lords.
Is there a mandate for the Bill? No one came up to me during the general election campaign to say, "Tony, we will vote Labour only if you promise that we cannot vote for an individual candidate in the European elections." No one said any such thing, and I did not know that that was the policy. I have dealt with many Members of the European Parliament who are conscientious, who work with local Members of Parliament and who become known over a period in their constituencies, although that task is difficult as they cover nine parliamentary constituencies. They go to Brussels and Strasbourg to take up local cases, and they are as conscious of their constituency link as we are. I have reservations about the European Union, but that is another matter. If we must have an EU, and a European Parliament, the best way in which to elect that Parliament is to do it in the way that we do here. People are elected to speak for their constituents, and their constituents can, in the end, dispose of them.
The House will forgive me for quoting five democratic questions that I have developed during my life. If one meets a powerful person—Rupert Murdoch, perhaps, or Joe Stalin or Hitler—one can ask five questions: what power do you have; where did you get it; in whose interests do you exercise it; to whom are you accountable; and, how can we get rid of you? Anyone who cannot answer the last of those questions does not live in a democratic system. I am alarmed that any party should seek to impose candidates.
I served for 34 years on the national executive of the Labour party, and I was often responsible for decisions when contested parliamentary selection conferences came up. The rule that we followed was simple. If the procedure adopted to select a candidate was correct, the national executive always endorsed that candidate.

Mr. Beith: Always?

Mr. Benn: Yes. That was the principle involved. Liberals refer to closed lists under the first-past-the-post system, but the lists are not closed when the constituencies choose the candidates. Candidates are chosen by a selection process within their constituencies. The party should do no more than indicate whether it accepts that that is a valid principle on which to operate.
If we get away from that principle, MEPs will always look to the party leader, not to their constituents. There is a difference between being employed by one person and being employed by everyone. During last week's debate on proportional representation, I drew attention to the fact that we are employed by our constituents, and not by our parties. The idea that Members of Parliament or MEPs are simply local managers for the national party is absolutely contrary to everything for which people fought over many centuries as they argued for representative government.
The Liberal Democrat view puzzles me. That party has always been a great public advocate of being free from party hacks. I know why the Liberal Democrats are accepting the Bill; they have been given a job. I can see

members of a Cabinet Committee as I look across the Floor of the House. Part of the deal is that they should go along with the Government, and they will be given a bit of useful work. That is what the whole thing is about, and everyone knows it. No traditional Liberal would look twice at the Bill. Of course, when the Liberal Democrat party was set up, there was a split, and a real Liberal party still exists, which keeps writing to me.

Mr. Beith: A small one.

Mr. Benn: It may be small, but the Liberal Democrat party has had that problem itself on occasion. Better to be small and right, the Liberal party might argue, and I take that view myself.
I believe that the Bill is a test run for parliamentary elections. New Labour—a completely new party, as the Prime Minister has regularly reminded us—has a plan. The new system will be tested in Europe, and applied to the House of Commons. We shall all be worried then, not only about our Whips, but about the leaders of our parties and about our national executive, rather than about our constituents. That would destroy democracy.
One distinct effect would be a much lower turnout. Funnily enough, candidates of all parties become known and quite well liked in their constituencies; they would not be elected otherwise. Parties are not particularly popular. If I go round in the European election campaign and tell people to vote Labour, they may say that they rather like so-and-so. I will have to tell them that they cannot vote for him or her, and must vote Labour. That could well lead to a much lower turnout. A lower turnout undermines the legitimacy of the election process. In a way, I might welcome it if no one voted in the European elections. Part of me might say that that would be an early run of the referendum on the single currency. However, I do not believe in not voting. People should vote.
A further effect will he that Labour will lose a lot of seats. Everyone knows that the closed-list system will give us fewer MEPs than last time.

Mr. Beith: indicated assent.

Mr. Benn: The right hon. Gentleman is nodding in such a friendly way because he knows that that will happen. We are selling out the party that won the election to other people under a system that has never been specifically endorsed by the electorate.

Mr. Beith: The right hon. Gentleman stood on a Labour manifesto that specified that there would be a system of regional proportional election for the European Parliament. Does he recognise that low turnouts have occurred in previous European elections—particularly the record low turnouts of by-elections—and that the first-past-the-post system simply does not give a fair representation of the votes that are cast?

Mr. Benn: That is a general argument about proportional representation. The idea that every Liberal voter is a Liberal is wrong. To take a case from my constituency, a leading Liberal councillor voted for me because he did not like the Liberal candidate. I rather agreed with him. The Liberals went around the constituency saying that the only way to beat me was to vote Liberal, so the Tories voted Liberal.


To give another example against myself, a man told me after the general election that he had joined the Labour party on polling day. I said, "Fine. Who did you vote for?" He said, "I voted for the Liberals.". The idea that every voter is seeking proportionality is wrong. Every voter is seeking to be represented. The choice may well be a tactical one. I do not have to tell the Liberals that. They have been saying, "Vote tactically", for years, to keep the Tories or Labour out. Occasionally, they have argued their own case as well, although that has never been very successful in the final outcome. I have heard Liberals make the Liberal case; when they make it, I have always found it attractive and historically interesting.
The Home Secretary is in a jam with the House of Lords; they are for the chop, so they have nothing to lose. I was disappointed that we did not abolish the Lords last year in the first Queen's Speech. If we had, we would never have had the problem at all. If the Government had had the guts to deal with the Lords straight away, we could have had an election for the House of Lords by last Christmas and an election of any sort we liked in the European elections. The Government cannot do anything about it.
It does not please me that the Lords are likely to win. I sat through the age of consent debate when the Home Secretary pleaded with the House not to lose the Bill by insisting on an age of consent at 16. He argued that we must face reality. I thought that that was what new Labour was all about. The reality is that if the Lords vote the Bill down next time, we will be back to the old first-past-the-post system. All the lists will be scrapped. God knows what will happen in party headquarters when it is discovered that people can vote for the candidates that they like again. It will cause panic in Millbank tower and perhaps in the Liberal headquarters as well. There is no power for the Government to enforce their will on the Lords because they did not tackle the Lords early enough.
For all those reasons—I know that they are complex—I base myself on the simple principle that democracy will be destroyed if people cannot vote for and remove candidates, and if candidates are simply instruments of whatever may be a party's majorities and machinations when an election comes.
Parties change. I have known parties change from left to right. The Liberal party dissolved itself into the Liberal Democrats; it disappeared. It was one of the most remarkable acts of all time. The Liberals joined up with David Owen, who then voted Tory, and produced a new party. The only person the electors can rely on is the candidate whom they have heard, argued with, listened to, voted for and can vote out. Give that up, and we not only wreck the European elections, but begin to undermine the basis on which this House comes to debate issues and ultimately to decide them.

Mr. Allan: We are grateful to the Conservatives for allowing us such a long and detailed constitutional debate on electoral reform by bringing this measure back to the House so often. It allows us to discuss a subject dear to our hearts that has not often figured in the House until recently.
It is a particular pleasure to follow the right hon. Member for Chesterfield (Mr. Benn), who is now an ardent voice in this place for the rump Liberal party. I have sympathy with much of his argument, except that

I believe that it advanced a romantic view of the world. The world is not like that these days. For every instance of a person judging between candidates, there are far more of people having to vote for the closed list of one, the single party candidate with whom they are presented. People have to vote for a candidate against their judgment of him because they want to vote for Tony Blair or Paddy Ashdown as Prime Minister.
Sympathy for the arguments of the right hon. Member for Chesterfield leads my party to back the single transferable vote system as our preferred option. The amendment neither meets the Conservatives' wishes nor ours. Our preferred system is used in Northern Ireland in many elections. We accepted the Government's system for these elections with some reluctance; it is not our choice.
We have two fundamental objectives. First, we want to achieve greater proportionality. We believe that one of the best ways to get people to turn out and vote is the knowledge that their votes will matter. To date, Conservative votes in Sheffield have meant nothing in the European elections. We hope that those Conservatives will now vote because they have a chance. The same logic applies up and down the country where votes in the European elections will count whether we have closed or open lists.
The second objective is to increase voter choice. We believe that STV is the best way of doing that. If the right hon. Members for Chesterfield and for Sedgefield (Mr. Blair) were standing in the same constituency on a list, voters who wanted to support Labour could vote Labour and number them one and two, according to their shade of opinion in the party. That is our preferred option but it is not on the table.
We have accepted with some reluctance that the system should go forward as it is. Having accepted that, and having argued in Committee for the option that we thought sensible—the Belgian list system—and lost it, we are led to the point that with only a few days of parliamentary time left, we believe that our key objective of achieving fairer representation means that we cannot make further progress on voter choice without risking the Bill running into the buffers. That is the basis on which we have decided to vote.

Mr. Austin Mitchell: The hon. Gentleman does not like the choice and would prefer something not on the menu. The Liberals must choose between the two choices on offer, a closed list or an open list. Irrespective of the argument for rushing the measure through, which alternative would the Liberals prefer in the abstract?

Mr. Allan: I know that the hon. Gentleman is sympathetic to fairer voting systems. In the abstract, we would prefer open lists. I have stated that repeatedly. I have no problem with that but I have one with being drawn into an issue, despite the seductive offers of the right hon. Member for Sutton Coldfield (Sir N. Fowler), by the idea that because we oppose the Government on this, my enemy's enemy is automatically my friend. In this case my enemy's enemy has an open preference for first past the post. We have to judge whether co-operation furthers our cause of fairer votes or would aid a measure designed to spoil the outcome of the Bill. We have made that judgment and acted accordingly throughout.


Three main issues have emerged in our lengthy debates. First, the main problems discussed have nothing to do with the principle of whether lists are closed or open but concern the Labour party's selection methods. Many of the quotes in the press and in debates in both Houses—Welsh Members in particular have attended because they have some little local difficulties—have been about how Labour selected its candidates for the European elections.

Mr. Sayeed: Is that not a legitimate concern? That is how the law will operate, and it is perfectly proper to complain about it. If the law allows such operation, it should not be the law.

Mr. Allan: The hon. Gentleman makes a case to which I was going to come about how the law is moving forward in respect of selection for lists. The important thing is that but for the problem in the Labour party selection system, we might not have been debating the matter now. If all three parties had had an open selection process based on all their members voting, we might not have been here now because we would all have accepted the system.
The problem is not a fault of the closed-list system per se. The right hon. Member for Chesterfield feared that this is the way that things are going in the Labour party. I suspect that it already is. With any of the systems that we have discussed, a party could impose candidates from the centre. Labour's national executive committee could, if members were foolish enough to allow it the power, impose candidates in every Westminster seat. Candidates would be presented as a closed list of one. It is not the closed list that causes the problem but how parties decide to select their candidates.

Mr. Lansley: Does the hon. Gentleman recognise that the remedy for the Labour party's method of selecting candidates is through an open list? That follows from his point about voter choice by giving voters the option of choosing between candidates presented by a party list.

Mr. Allan: My second point relates to the specifics of the open list as proposed by the Conservatives and will serve to answer the hon. Gentleman by suggesting that the Finnish system is not the best.
Reference has been made to Lord Bethell, who is himself a candidate. He pointed out not only the specific difficulties of the semi-random or arbitrary nature of the way in which the proposed system would operate, but the practical difficulties in respect of next June's elections if we to make a sudden change. It is quite clear that there would be problems with the Finnish system. My party has a perfect slate of candidates and those at the bottom of the list are just as good as those at the top. Although we would be happy for any of them to be elected, that may not always apply to every list in every region. Given the possibility of a random selection of MEPs on the list being elected, some parties might wish to revisit the list and check who was on it.

Mr. Tim Loughton: I refer the hon. Gentleman to his own party's selection procedure. Is it not the case that the Liberal Democrats

use the zipper system which gives undue preference to the smaller number of female candidates who wish to stand as Liberal Democrat MEPs?

Mr. Allan: The hon. Gentleman is straying into a matter of some detail. However, he raises an example of where the open-list system would remove the democratic decision that we made as a party. One of our priorities is to have decent representation of women. The party voted for that and in that sense we are ashamed of our representation here. We wish women to be better represented and we are prepared to take steps to ensure that. That is a perfectly sensible choice given that the party voted for it.

Mr. Benn: If all the Liberal candidates next year are as good as each other, why cannot the electors choose who they want? Is not that the issue? If the hon. Gentleman favours the open list, why will he go into the Lobby tonight and vote for the closed list? If he voted for the open list the matter would go back to the Lords with the Lords' view prevailing.

Mr. Allan: While I believe that any of our candidates would be equally good, the members of my party have decided on a particular order. As they had made a democratic decision, they would wish to revisit it, as would the members of any party, once the system had been changed.

Mrs. Dunwoody: Is not the hon. Gentleman elucidating exactly what is wrong with the system? In Germany, which has already been mentioned, the bizarre situation can arise whereby someone who is thrown out by the electorate can be put back onto the list system. That is quite ridiculous.

Mr. Allan: I would respectfully suggest that the hon. Lady is referring to a completely different system—the German additional-Member system.
To return to the system that we are debating, if we were to proceed with the Conservative proposal, the tacticians within every party would advise withdrawing all candidates except those likely to win. The parties would wish to put forward a slate of candidates that, in our case, had been democratically selected. As Lord Bethell quite rightly said, no party would favour putting forward a random list of 10 or 11 candidates in the south-east.

Mr. Lansley: I am grateful to the hon. Gentleman for his courtesy in giving way to me again. He keeps talking about a random list. Does he not recognise that the Bill—with the Lords amendment to proposed section 3(5)—would make it perfectly possible for a party to present a list in the order of its own choice, but the voters, by their preferences, could choose to change it?

Mr. Allan: The voters would still be left with the option of simply voting for individual candidates, without the Belgian option of voting for the party's choice.
My third point is that everyone who has spoken so far, including the Home Secretary and Opposition Back Benchers, has highlighted the problem of first past the post being a closed-list system of one and expressed the wish to enhance voter choice—and we agree. However,


the first-past-the-post system, which we believe is the alternative if we are unable to resolve our dispute tonight, would represent a significant step backwards. I hope that the fundamental point made by the right hon. Member for Sutton Coldfield about transferring power from the people to the party is an indication that he now supports some form of single transferable vote.
As the right hon. Gentleman knows, under the current system we all owe our presentation to the electorate to our selection by a small group of party members. We do not have a primary system and the voters in our constituencies do not get to choose the candidates for each party. We are often selected by an odd group of party members in a village hall somewhere—I think particularly of the Conservatives when I say that. Once we have been selected, we know that we are the party candidates in a closed list of one.

Mr. Harry Barnes: It really is nonsense for people to keep talking about a closed list of one. There is no such thing. Closed lists are the opposite of open lists. We cannot have an open list of one, therefore we cannot have a closed list of one.

Mr. Allan: The arguments that are often put forward by Conservative Members suggest that they are moving towards proposing some form of primary, which would effectively be an open-list system of one because a primary system establishes the number one candidate for a party. Their arguments against the current system relate to what happens to those at the bottom of the list, who are in the same position as those who come second or third in a selection battle for a Westminster seat—they are simply unlikely to win.
We believe that the MEP candidates who have been selected by the Opposition parties at least have the endorsement of thousands of their local party members. We should like to extend voter choice and revisit the issue in the review that the Home Secretary has promised. We welcome that review as it will provide an opportunity to argue again in favour of the single transferable vote, which is our first choice of voting system. We do not believe that this is the right time to oppose the Bill or join those who, at this late stage, seek to amend it when, at the appropriate stage, they declined to vote with our Peers in another place for the amendment that would have introduced the far more sensible Belgian open-list system.

Mr. Martin Linton: Listening to tonight's debate, one word springs to mind; it is not principle or opposition, but opportunism. The Conservative party has always believed in the closed-list system and only last week told the House of its total faith in the first-past-the-post system. With due respect to my hon. Friend the Member for North-East Derbyshire (Mr. Barnes), the latter is a closed-list system because if one wanted to elect a Conservative candidate to Parliament, but had the misfortune to live in Sutton Coldfield, one would have no alternative but to vote for the right hon. Member for Sutton Coldfield (Sir N. Fowler). There is no choice of candidate—only of party.
I would be intrigued to hear from Opposition Members whether they would really support an open-list system for the European elections when the likes of Mr. Paul Sykes might provide millions of pounds to campaign in favour of voting solely for eurosceptic candidates. That would

wreak complete havoc in those elections. I leave them to dwell on that point. However, I will not deny the right hon. Member for Sutton Coldfield the opportunity of hearing yet another Back Bencher acknowledge that there are some advantages to an open-list system, provided that it allowed people to tick either the party box or the candidate box—which would not be a truly open system, but a Belgian system—and provided that the voters had the possibility of knowing something about the candidates, which is the case in respect of all those standing in European elections.
Nevertheless, as a Back Bencher, I will give the right hon. Gentleman the rationale for why closed-list systems should sometimes be preferred—there needs to be a separation of power. Parties select candidates and voters elect them. The more say the voters have about the choice of candidates, the less influence they have on the result of the election.
Let me give two simple examples of countries that allow voters to have some say, not only in the election of parties, but in the selection of candidates. The Irish voting system uses the single transferable vote, which allows voters to pick between candidates of Fianna Fail or of Fine Gael and between parties. It has resulted in there being no clear ideological distinction between Fianna Fail and Fine Gael, and sometimes between them and the Irish Labour party. That is the result of giving voters the luxury of choosing candidates, which detracts from their power in the choice of parties.
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The second example is that of the United States, which uses the first-past-the-post system, which should meet with the Conservatives' approval. However, it also makes use of primaries, in which voters are able to exercise a choice in the selection of candidates from their own party, and sometimes those of other parties as well—we have all heard of Republican raids on Democratic primaries. What is the result of that system, which allows the voter two bites of cherry, first in the choice of candidate and then in the choice of party? It is that there is no clear difference between the parties; as any textbook will say, there is a huge ideological overlap between Democrats and Republicans. The reason is that, in the desire to give voters more choice, the US system has given them so much choice that it confuses the choice of candidate with the choice of party.
That is the rationale for arguing that open lists can sometimes be self-defeating. They cannot give the voter more choice overall: voter choice is concentrated either on the choice between parties, or on the choice between candidates; and any system that tries to do both confuses the issue.

Mr. Peter Bottomley: Is there a single Member of Parliament for any party who stood for election last year on the basis of a closed-list system for Europe?

Mr. Linton: I admire the chutzpah of the hon. Gentleman and his right hon. and hon. Friends, who are all totally opposed to any change in the voting system and totally in favour of first past the post, which is a closed-list system. They probably had not even heard of open and closed lists until a few weeks ago, but suddenly


they are the world's greatest advocates of open lists. Some of them do not even understand what open lists are—witness the fact that they so often confuse the issue of open or closed lists with that of how candidates are chosen.
That is the other side of the coin regarding the rationale for closed lists. If one has closed lists, one must have the candidates clearly selected and ranked by the political parties. That must be done on the basis of one member, one vote.

Mr. Mitchell: I am somewhat confused by my hon. Friend's argument. Like me, he is a supporter of proportional representation, so I cannot understand why he is arguing that the electorate are not intellectually up to the level of decision making exercised by the parties in choosing the lists.

Mr. Linton: As I explained, I acknowledge the arguments in favour of the sort of open lists that were discussed earlier. I am, however, explaining the rationale for closed lists: if people are allowed to choose between candidates, the inevitable effect is to fudge the basic issue of the choice between the parties. I am simply making the point in principle that one cannot give people the choice offered by open lists without detracting from their choice between parties.
As I said, the corollary of that must be that the parties choose their candidates in a democratic way. The issue is quite separate from that of open lists, but the Labour party, which has been mentioned several times, uses panels to rank candidates. That process was described by the general secretary of the party as a transitional system for one election only and I shall be glad to hold him to his word.
There is a specific difficulty facing each of the parties in the coming election: for example, the system offers the Labour party more seats in the south-west, but fewer in the north-west. There was a temptation to manage the transition so that we did not end up with too many of our people representing seats in the north-west and too few in the south-west.

Mr. Llew Smith: I do not understand the logic of my hon. Friend's argument, or why we need to move Glyn Ford from Manchester to No. 1 on the list for south-west England. I do not perceive the logic in that. The answer to the problem is to allow party members in each region to state their preferences by way of one person, one vote. Will my hon. Friend defend what has happened in Wales, where the person who is third on the list did not receive one vote in Wales? Can he explain why Alec Smith in Scotland, Mike McGowan in Leeds and Christine Oddy—

Mr. Deputy Speaker (Mr. Michael J. Martin): Order. I cannot allow the hon. Gentleman to go on for so long.

Mr. Linton: My hon. Friend anticipates my point. I was arguing against a system whereby a party took upon itself the job of managing the transition. Glyn Ford, who represents a seat in the north-west in the European Parliament, actually comes from Stroud, so it would not

have been at all difficult for him to win the selection that he has got—that of No. 1 on the list in the south-west—under a system that allowed the party members to choose democratically. It could have been done democratically, instead of being managed by the party.
I have always said that it is a mistake for parties to get involved in managing the transition. That is nothing new-I told the national executive of my views when it asked for them, and I wrote publicly on the matter at the time. I shall continue to argue that case, but the issue involved is entirely different from that of open and closed lists.

Mr. Llew Smith: We now know the birthplace of Glyn Ford and how that justifies his going to the south-west. Can my hon. Friend now tell me the birthplace of the person who is No. 3 on the list in Wales?

Mr. Linton: I am arguing on the same side as my hon. Friend—in favour of a democratic decision on the selection and ranking of candidates. However, the issue of open and closed lists is quite separate. All the discussion about control freaks, centralisation and party bosses is totally irrelevant to the issue of whether we have open or closed lists.
One of the better aspects of the report of the independent commission on the voting system is that it advocates voting on open lists, but within counties and smaller units. The level at which open lists will work worst is in large regions, where the possibility of voters being familiar with the characteristics and politics of each of the candidates on a long list of up to eleven people is remote.

Mr. Benn: Take an individual candidate—Michael Elliott for London, who has been a Member of the European Parliament for 14 years and who has been put at the bottom of the list. Despite the fact that, in three European elections, the people of his constituency have chosen him to be their MEP, the party machine has put him down to the point where, unless everybody votes Labour, he will not get back. What is the justification for that?

Mr. Linton: My right hon. Friend has mistaken my argument. We are entirely as one on that issue. During the consultation period, I wrote to the NEC to say that the question should be decided by OMOV. What is more, I would chance the view that the members of London voting in a one member, one vote ballot would have resulted in much the same listing as was obtained through the panel. The point is that it should be done in a democratic way. I entirely agree with my right hon. Friend on that point. I am simply trying to make it clear that the issue of how parties select their candidates is totally different from the issue of open or closed lists. Germany, France, Greece, Spain and Portugal use closed lists because they recognise that in European elections, when electoral regions are largest, the open-list system works least well.
I ask the House to see the issues in perspective. We are about to pass a Bill that will bring about a huge change in our voting system and hugely increase the choice for voters. It will mean that Labour voters in Surrey and Conservative voters in Glasgow will, for the first time,


have some chance of having a representative of their own party in the European Parliament. It will enfranchise millions of people in this country.

Mr. Swayne: Has the hon. Gentleman not given the lie to his whole argument by saying that the voter will have, not his representative, but the representative of his party in the European Parliament?

Mr. Linton: It is about time that hon. Members had the humility to recognise that when the good denizens of New Forest, West put their cross against the hon. Gentleman's name, nine out of 10 are not expressing their personal admiration for him. I am sorry to have to tell him that they are probably expressing a preference for the Conservative party. Although, as I have said repeatedly, it is good if a system allows the voters to have some influence on candidates as well as parties, we must start from a clear understanding that nine out of 10 voters, or probably 99 out of 100, are making a choice between parties and Governments, not between individuals.
Although the issue of whether we have semi-open or closed lists in European elections is important and worth debating, and I have opinions on it, by comparison with the thrust of the Bill it is a tiny issue. This is the Opposition's attempt to stir up the mud to cloud the overall issue.
The parties have 300 candidates in place. The Bill went through the House of Commons last time by a majority of 307 to 125. The system is already used by the major countries in Europe, including Germany, France and Spain. To take opposition any further will merely expose the Conservative party's opportunism. At any time in the past 100 years the Conservatives could have proposed multi-member lists in first-past-the-post elections.
My hon. Friend the Member for North-East Derbyshire said that such a system cannot be applied to first past the post. Of course it can. We could easily have more than one candidate standing in the first-past-the-post system and allow the voter to choose between candidates of the same party. We prefer not to do so because it might split the vote, as Conservative Members know full well and they would not risk that. Technically, however, it is perfectly possible. In the past 100 years, the Conservatives have never expressed any interest in or support for open lists.

Mr. Nicholas Winterton: I have been following the hon. Gentleman's argument with interest but also with difficulty because he appears to be riding the fence, and that can be very painful. As one of those Members who perhaps falls into the 10 per cent. that he referred to in response to the intervention of my hon. Friend the Member for New Forest, West (Mr. Swayne), can I ask him whether he is trying to enfranchise the people of this country or the political parties and establishment?

Mr. Linton: It is well known that even Mr. Brian Redhead voted across the party divide for the hon. Member for Macclesfield (Mr. Winterton) because of his admiration for the hon. Gentleman's constituency work. It is sad to say, however, that even allowing for the fact

that many people in Macclesfield no doubt admire the hon. Gentleman's work for the local hospital and so on, most of them vote for him because he represents the Conservative party. His Front-Bench colleagues may not agree.

Mr. Mitchell: It might be better if the name of the hon. Member for Macclesfield were not printed on the ballot paper. The logical conclusion of my hon. Friend's argument is that we print only party names, not those of candidates, and we pick the candidates afterwards. [Interruption.]

Mr. Deputy Speaker: Order. There is far too much background noise in the Chamber. The hon. Gentleman who is speaking should be heard properly.

Mr. Linton: My hon. Friend the Member for Great Grimsby (Mr. Mitchell) knows that it is a dilemma of every electoral system that although we put forward candidates, most people are choosing parties and Governments. Of course it is important to keep the safety valve of having candidates as well as parties, which gives the people the possibility to choose one without the other. However, we must face the fact that under our existing system of first past the post, people must go to extraordinary lengths to remove Members such as the hon. Member for Macclesfield—not that they would want to do so—or the hon. Member for New Forest, West. There would have to be a revolution in the New Forest before so many people swung away from the Conservative party that New Forest, West went Labour. I look forward to that very much but it is unlikely to happen.
Semi-open lists, which we are offered by the Opposition, would make very little difference. The Under-Secretary will correct me if I am wrong, but in all the time that such lists have been used in Belgium, there has been only one known instance of a candidate in a lower position being moved up by the votes that he or she received on the open list to be elected when that person would not otherwise have been elected. There may have been two cases at the very most. The issue is a dot and comma in the electoral system that we are discussing. The House should remember that compared with the issue of whether the Bill is passed, the newly discovered question of open and closed lists, which the Opposition are still trying to get used to, is tiny and should be put in perspective.

Mr. Sayeed: It is customary to respond to the preceding speech, but I found the speech of the hon. Member for Battersea (Mr. Linton) so confusing and internally contradictory that I do not intend even to try to respond to it.
As this bad Bill has shuttle-cocked between the two Chambers, the same old lags on the Labour Front Bench have made the same old tired and specious arguments. Government supporters have been laggardly in coming forward and supporting what the Government are trying to do. Even the Home Secretary today made a speech that was designed to fill a space rather than make a difference. He repeated the same old canard that the Bill's defeat in the Lords was the fault of those wicked Conservative hereditary peers.

Mr. Caplin: It is true.

Mr. Sayeed: The hon. Gentleman may learn something if he listens. He seems to forget that 38 of the


53 Cross-Bench peers—I have a list here and I have counted—who voted in a Division on 12 November voted against the Government. More than 70 per cent. of those peers who owe no party allegiance voted against a Government measure because the principle was wrong.

Mr. Caplin: Will the hon. Gentleman accept that in all the three votes on this issue in the other place, the Conservative party's victory—if that is what it is—has occurred because of the votes of hereditary peers?

Mr. Sayeed: The critical point is how those who owe no party allegiance vote, and it is absolutely clear that on 12 November over 70 per cent. of them failed to support Labour's proposals. Indeed, on that date not one Labour or Liberal Back-Bench peer spoke in favour of the Government's measures, just as on 10 November not one Labour Back Bencher made a speech supporting the Government's proposals.

Mr. Andy King: Will the hon. Gentleman clarify whether the measure would have been passed in the other place if the hereditary peers had been discounted?

Mr. Sayeed: That is not the critical point. We must consider how those who owe no party allegiance vote, because that is probably the best way of judging the merits of an argument.

Mr. Beith: I recall that the situation was the same with the poll tax, but I do not remember Conservative Ministers coming to the House and saying, "We are dropping this measure because we have counted the Cross-Bench peers and more of them voted against it than voted for it."

Mr. Sayeed: The right hon. Gentleman should deal with this specific measure, on which his party does not have a very honourable position to defend.

Mrs. Dunwoody: Perhaps I should point out that, if the then Conservative Government had had the common sense to abandon the poll tax because of the result that they achieved in the House of Lords, they might not have got into nearly so much trouble.

Mr. Sayeed: I thank the hon. Lady for her assistance in supporting my arguments.
It is quite surprising that not one Back-Bench Labour peer or Labour Member in this place has spoken in support of the Government's proposals. It is even more surprising bearing in mind the subservient nature of Labour Back-Bench questions and how Tone's clones have been parachuted into the House of peers—not because they have any merit but because they are friends of the Prime Minister. Even they were not prepared to support the Bill. I suspect that that is because this debate is not about closed lists versus open lists—although I believe that open lists are far superior and more democratic.
I believe that not one Labour Back-Bench Member of Parliament or Labour Back-Bench peer is prepared to support this measure because of the way the Labour party intends to operate closed lists. That is the real reason and that is what has really stuck in their craw.
It is worth reminding the House of the speech made by the hon. Member for Wrexham (Dr. Marek) on 10 November. He said:
I took part in a vote, with many fellow members of the north Wales Labour party, for those whom we thought should be on the list for the Welsh constituency of five members. We voted for our sitting candidate, Mr. Wilson, by, I think, about 98 per cent, yet, at the last stage, after the matter went into Millbank tower, where heaven knows what happens, a candidate from across the border in England appears on our list in Wales in third position".
The hon. Gentleman continued:
he came from outside the area and we in Wales had no knowledge that he was interested in being on the list in Wales and he was not considered as one of those in contention for a place on the list by the Labour party members in north Wales. Yet there he is in third position and the candidate for whom 98 per cent. of Labour members in north Wales voted is in fourth position—an unlikely winning position for the Labour party in the elections.
That cannot be right."—[Official Report, 10 November 1998; Vol. 319, c. 228.]

Mr. Deputy Speaker: Order. Hansard is available to every hon. Member, so the hon. Member for Mid-Bedfordshire (Mr. Sayeed) does not need to read an extract from it verbatim. The hon. Gentleman has made his point and perhaps he should now move on.

Mr. Sayeed: I thank you for your help, Mr. Deputy Speaker. The hon. Member for Wrexham—a Labour Member and a former shadow Minister—was making the point that this system cannot be right because it is not open and it is undemocratic.
I think that even the Home Secretary is seized of that argument. I believe that, if the Labour party had chosen the system that we favour, whereby the party membership selects, openly and democratically, both those who should be on the list and the order in which they should appear, we would not have seen this Bill return from the Lords again. However, the Labour party has not done that. Its operation of the closed list is so undemocratic that I consider it an affront to democracy.

Mr. Caplin: Is the hon. Gentleman aware that in the south-east—where my constituency of Hove is located—our Member of the European Parliament, Mr. Brendan Donnelly, has been de-selected by his own party not because of any democratic views but because of his views and those of the Leader of the Opposition regarding the single currency?

Mr. Sayeed: I am grateful for the hon. Gentleman's assistance, but he has got it totally wrong. Mr. Donnelly was not selected by the party members who attended a selection conference. The hon. Member for Wrexham made the point that the candidate in north Wales who received 98 per cent. of the votes was placed in such a low position on the list by the party executive at Millbank that he had no chance of getting elected. That is wrong.

Mr. Loughton: My constituency adjoins that of the hon. Member for Hove (Mr. Caplin), and I know that almost 2,000 members of the regional Conservative party voted to put that MEP in that position on the list. Does my hon. Friend know how many members of the Labour


party in the south-east region had an opportunity to select the candidates that will appear on the ballot paper representing the Labour party?

Mr. Sayeed: I have not been to Millbank tower, so I do not know whether it is one, two or three apparatchiks. However, I presume that the Prime Minister will decide what the party gets.
I was interested to listen to the Home Secretary's speech tonight, which was surprisingly half-hearted. It was slightly jokey—as most of his speeches are—but it was extraordinarily shallow. I believe that the Home Secretary's heart is no longer in this Bill. His amendments to the Bill are so banal that he must recognise that he has no chance of placating the Lords. I suspect that, after consulting his friends in the parliamentary Labour party, he has concluded that closed lists are undemocratic. He has never been a particular supporter of proportional representation, but he now recognises that this is an opportunity to double-cross the Liberal Democrats. He will not only double-cross the Liberal Democrats by ensuring that we do not get PR for European elections but he will ensure that we do not get closed lists, which his parliamentary party does not want. He will then blame—

Mr. Deputy Speaker: Order. I think that the hon. Gentleman is associating the Prime Minister with a double cross. I hope that he is not suggesting that a Member of this place would do anything underhand.

Mr. Sayeed: I am glad to clarify my comments. First, I was referring to the Home Secretary and, secondly, I did not say that he was double crossing anyone. I suggested that he had the opportunity to double-cross the Liberal Democrats—there is a difference.

Mr. Deputy Speaker: The hon. Gentleman should make himself clear. I hope that he is not suggesting that any Member of the House would do anything underhand. If he says that he is not trying to do that, I am happy to let him continue.

Mr. Sayeed: Thank you, Mr. Deputy Speaker. Of course I would not even suggest that the Home Secretary would attempt to double-cross any other person or do anything underhand. I am saying that this is a way of getting at the Liberal party. This is a way of preventing PR. This is a way of getting rid of closed-list systems, which he knows that Labour Back Benchers do not like. As he has shown, he is in a position to blame the change of direction on hereditary peers, however erroneously ascribed that blame is.
We know for certain, however, that the way in which the Labour party intends to operate the Bill, if passed, is an affront to democracy. It will allow the Labour party—the Labour party machine—to determine who is elected; and the responsibility of those who are selected and, consequently, elected will be, not to the electorate, but to the Labour party machine.

Mr. Beith: I must be a bit naive. Surely the hon. Gentleman understands that, if he succeeds and the Bill fails, first, more Labour MPs will be elected than under the present system, and secondly, it will be open to the central machinery of the Labour party, through the selection panel system, to ensure that only those that it

wants are elected. Therefore, the results that he fears will happen in much larger measure if he succeeds in killing the Bill.

Mr. Sayeed: That casts some light on why the Liberal party, having said that it wants open lists, now says that it wants closed lists, but the right hon. Gentleman has got it wrong. I believe that, as the people realise how much contempt for democracy is revealed by the things that the Government are trying to do, they will demand of the Labour party more honest, more open selection and election procedures.
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The Bill may have a quixotic result. I believe that it has emboldened the House of Lords and enhanced its legitimacy. The Bill has shown the need for an independent second chamber. I believe that it will make the Government's life more difficult, and I am delighted with that.

Mr. Mitchell: I have previously abstained in Divisions on this measure. It was the most difficult form of abstention, because I always come along to abstain in person. I shall now air my indecision by giving the arguments for the abstention, although my indecision is less decisive than the indecision of the hon. Member for Sheffield, Hallam (Mr. Allan).
At this stage in what looks like a futile argument, we need a futile gesture, because what is going on is a battle of prehistoric monsters—a virility contest between the Government and the House of Lords. I am too old to be into virility contests. I am a safe pair of trousers, of course—we all are, on the Labour Benches—but I am not a virility contest person. In this eyeball-to-eyeball confrontation—it is pink eyeball to pink eyeball, one from principle and the other from port—neither side is effectively right.
I am the biggest fan of my right hon. Friend the Home Secretary. I hope that the Under-Secretary will transmit that message to him; it might do me good. The Home Secretary chose the worst possible form of proportional representation—which I support—for the Bill, perhaps deliberately, in the hope of discrediting proportional representation; whereas the House of Lords is kicking over the traces on behalf of the Conservative party, which does not want any PR at all, in the hope that the Conservative party will go out on a limb and support the hereditary peers. The Lords are scratching the back of the Conservative party by doing what they believe will please it—making a nuisance of themselves for the Government.
It is an argument in which neither side is right, and it is depressing in the extreme to watch the battle of mastodons going on at the expense of the European elections next year. The Government's majority is in single hundreds, it is true; we do not yet have total control, as we shall eventually, but we have a majority to do anything, and the hereditary peers are just having a bit of fun—a last fling before extinction. It is not really Lords versus Commons; it is the hereditary peers versus the hereditary believers in first past the post. Most MPs believe in first past the post because they believe that any system that elected them must be the wisest, most effective system available.


It has been suggested to me, in the friendly discussions that one has with Whips—I am a big admirer of my personal Whip—

Mr. Benn: Put him on the list.

Mr. Mitchell: Perhaps they will put me on the list.
It has been suggested that I should regard this as a battle between Lords and Commons, and that I could do myself a bit of good by voting with the Government this time. [Laughter.] Labour Whips do give us helpful advice; that is what they are there for. As Opposition Members are laughing, I want to make it clear that the Labour party is not a party of control freaks—I am authorised to say that.
We should therefore decide on the basis of the argument, but the argument has been extremely confusing for someone like me. I always admired the Liberals as men and women of principle—a party of principle—but after admiring them for that for 18 years, it is terrifying to see how cheap they come now. We used to say in the back row of the Glenroyal cinema in Shipley that some girls were easy and some girls were not. The Liberals are easy: a few crumbs from the table of power, and they will throw away their principles on terrorist legislation, on proportional representation and on open lists. That is cheap.
I want the same thing myself. I would like a bit of power too, so I can understand the Liberals taking that approach. My friends, my fellow executives of the Labour campaign for electoral reform, in which we have all fought together, will tonight take a firm stand and say that we shall hold the Government to the review. We shall be really tough about the review, after the election is over.
My hon. Friend the Member for Battersea (Mr. Linton) has confused me with the argument that we should have closed lists because the people cannot judge, except on a party basis, but that the parties should choose on the basis of one member one vote. They have not done so, which to my mind destroys the argument for closed lists. I could not follow that argument.

Mr. Linton: My hon. Friend has a short memory. I said at the beginning of my contribution that I would prefer an open-list system, but I gave the rationale for a closed-list system.

Mr. Mitchell: I had not understood for the wrong reasons. Now I do not understand for the right reasons. I am much happier with that situation.
There is one simple principle on which we should judge the argument between a closed list and an open list, which is that the electorate will resent having a closed list imposed on them. They will resent not being able to make any choice at all. It is not a burning issue. Most of them will not bother to vote in the European elections. They will stay a mile away, and rightly too. European elections are boring.
If voters are told that they do not have the power to choose, they will mostly vote on party lines. I am sure that they will want to vote for us—we are extremely popular, we are a good party, and we have a leader who

throws his cloak over the whole party. We shall do well in the elections, but we are telling the electorate that they cannot make any choice—they must vote as the party wants them to vote.
That will produce a festering resentment, which will do us no good. It is a basic flaw in democracy. We cannot say that to the people. We should maximise choice. They will resent it if they feel that they cannot pick and choose within the list when they know enough about the candidates to pick and choose.
I have aired my agonising indecision. I shall leave the Chamber for a little while to commune with destiny. I shall be sitting in the Cafeteria downstairs, eating my sausage and mash, and awaiting offers. After 18 years in futile opposition, I would like a bit of power. My ambitions are higher than those of the Liberals, because I want to be a PPS. I intend to contemplate my vote, eat my sausage and mash, and hope that somebody comes down to see me.

Mr. Peter Bottomley: I am glad that there is no ruling from the Chair that we are not allowed to be amused by the hon. Member for Great Grimsby (Mr. Mitchell). He made the speech by the hon. Member for Battersea (Mr. Linton) look no better than it was when we first heard it, and he has made the speech by the hon. Member for Sheffield, Hallam (Mr. Allan), which looked good by comparison with the speech from Battersea, look not quite as good as it did after we had heard only the latter.
We have heard from hon. Members that the voting system is a bit of fun, that it is a tiny issue, that being able to vote for an individual is something to do with a safety valve, and that it is a dot and a comma. It will be the first vote in this island in which not a single voter will vote for a single candidate, and not a single candidate will receive a single vote from a voter. That is more than a dot or a comma.
It is also worth noting that the Government would intend that in most cases there would not be by-elections. If that applied to this House, the hon. Member for Great Grimsby would never have been chosen by the control freaks to stand in general elections. His constituency party was looking for someone in a by-election to hold a seat that it thought it might lose. The Under-Secretary of State for the Home Department, the hon. Member for Vauxhall (Kate Hoey) was another by-election entrant, and so was I.
One of the disadvantages of a party-list system, or even of the big multi-constituency system, is that we begin to lose the opportunity between elections of understanding what the voters are thinking. I shall give one example from outside my constituency at a local level. Even though the Labour party is apparently standing with more than half the popular support, it cannot put up candidates in many of the south-coast by-elections. When one considers the swings from the Liberal Democrats, say, to the Tories in the area which I represent in part, real votes being counted encourages putting forward good candidates whom the voters like and tells us something about the way the wind is moving between the parties.
As my right hon. Friend the Member for Sutton Coldfield (Sir N. Fowler) said, we are not now debating whether to have the first-past-the-post system in single-Member constituencies. The Bill is not about that. The test is the simple one of why, when the


Prime Minister last Wednesday defended the closed-list system, not one of the independently minded Back-Bench Labour Members nodded agreement to what the right hon. Gentleman was saying.
If there were a secret ballot among Labour Back Benchers to give them the choice of an open system or a closed system, the vast majority would vote for an open system. If they were given a free vote, they would vote for an open system using their own names on the Division list. Instead, they are being told by their Whips to support the closed-list system for reasons which most of them do not understand. Perhaps we cannot assume that, because most of them are not speaking; but those who have spoken have shown that they do not understand. They have said clearly in most of the arguments that they would prefer to have an open-list system.
The Liberal Democrats have said that they would prefer to have more of an open-list system, which is why they will vote with Labour Back Benchers for something that they do not want. If the choice is, as the Lords Labour Minister said on the radio, whether one wants to vote with the hereditaries for what Labour Back-Bench Members want or to overturn their judgment and, for example, stand with cross-Bench Members of the House of Lords, I would go on the whole for those with some degree of independence rather than for those being controlled by the Whips—however engaging the Government Whips might be.
I suggest an extra question that the right hon. Member for Chesterfield (Mr. Benn) might consider. His first five questions are good ones but I suggest that the sixth might be how much power we give to a few people. At present, I believe that the Labour Whips—I use them as a sort of cloak for the people round the Prime Minister—have too much power. They have persuaded Labour Back Benchers to vote for something in which they do not believe. They have also managed to persuade the Liberal Democrats to vote for something in which they do not believe either.
If the Government do not insist on having closed lists, that will be good for democracy, good for the House and good for the country. It might even start a tendency for those in other parts of the European Union to say, "Why don't we go more to smaller constituencies than, in some cases, the whole nation; why don't we go for smaller constituencies than the multi-Member mammoths?" We are facing multi-Member mammoths in this country.
There has been talk of the various ways of selecting candidates and where they stand on the list. I think that the Tory party has the best system of the three parties but in my view it is still a bad system. It would be far better to have Members of the European Parliament representing areas where they have a chance of getting to know the people and to be known by the people. That would be far better than having nine, 11 or even five Members for the same area.
I believe that when historians of politics write up this period they will say that what the Labour Government were doing was wrong. For those who have any sense of independence—I include the hon. Member for Great Grimsby in that category—I have some advice. If I were the hon. Gentleman I would return from my meal and, instead of being like a poached egg on a fence, vote for what the majority of his colleagues want. The hon. Gentleman's Labour colleagues will not vote for the open-list system but he should.

Mrs. Dunwoody: When I was a Member of the European Parliament, one of the constant arguments between myself and other Members of the socialist group arose from their saying that we should have proportional representation and a list system. Their constant complaint was that the British were the only people who did not have the name at the top of the list of a very well-known socialist politician. They said that that was the only way in which they were able to obtain any sensible vote. They asked why we could not at that time have someone such as the gentleman they called "Nail Kinnock" at the head of our list.
I had some difficulty explaining to them that even the most inadequate of our elected Members had a direct connection with the area which they were elected to represent. That was something that they found extremely difficult to understand. Having worked for many years on the continent, I understood their confusion: their system has always been party-controlled and party-based. For example, the Dutch system has both religious and political divisions, so I was one of the first people to work for both a socialist and a Catholic radio station.
The link between voting for a person and voting for a candidate is important. We are all here because of our commitment to our party. I have been a member of the Labour party since I was 16 years old, although I sometimes wonder which Labour party. The other day, my lovely Deputy Chief Whip suggested that I had one of my own, which was a bit rotten of him.
9.15 Pm
Although we are all here because of our party connections, in our system of government people connect parties with individuals. Individual Members of Parliament take the flak in their constituencies for the views of their party, and take their constituents' views back to the elected Chamber. They have a direct link with a geographical area, and are regarded as the representative of that area. It would be a dire day if we were to lose that.
I have argued about this matter within my party, and I understand those who said that, because an undertaking was given many moons ago that we would move towards the same system as the rest of Europe—this is really all about conformity of electoral systems—we would have to come up with a system that was different from the one that we operated. I was prepared to argue about that, but I lost the argument within my party.
I have grave reservations about the idea that, in the final analysis, the electorate should not be given the ability to decide their own candidate. That is why I have abstained on this Bill. Candidates come in all shapes, sizes and types—some admirable and some not quite so admirable, some well known to the electorate and some building a reputation.
My objections to the Bill do not stem from the Labour party's behaviour. The Labour party has got itself into a hole, which is not altogether unusual in my lifetime, and I should like it to stop digging. If it persists, I simply want to put it on the record that I firmly believe that, when the electorate vote for me they show great intelligence, ability, understanding and sensitivity, whereas, when they


vote for anybody else, they show a great inability to understand political issues. The reality for politics in this country remains that the electorate should decide.

Mr. Nicholas Winterton: Will the hon. Gentleman—I mean hon. Lady—give way?

Mrs. Dunwoody: I am very fond of the hon. Gentleman. If he has not yet learnt that I am not a man, we are in trouble.

Mr. Winterton: I am grateful for the hon. Lady's tolerance. Will she be frank enough to admit to the House that, two or three elections ago, she should have lost her seat, because, in normal circumstances, the swing would have had her well defeated in Crewe and Nantwich? However, I am happy to say from the Conservative Benches that, because of the respect in which she is held as a result of the wonderful work that she has done for her constituency since she was first elected, she won the seat. Does she believe, as I do, in trusting and respecting people because they know what they are doing?

Mrs. Dunwoody: I frequently explain to people that my constituents may say, "She is an unfortunate person with unmarried parents, but she is our unfortunate person with unmarried parents." That is quite important in elections.
I feel very strongly about this matter. I speak tonight not because I believe that we are being asked to choose between an inadequate system and an even more inadequate system, but for a very different reason. I saw the effect of list systems on the European Parliament and the control that all political parties exercised. I explained time and again—wrongly, it now appears—that we would find it difficult to accept that system in Britain, because we had a genuine commitment to a constituency link and we believed that the individual was tremendously important in our system of government. I believe that very strongly.
I shall not vote tonight, which is unusual for me, because it is the coward's way out. I want to record my deep worry about the breaking of that link. Whatever we think of the electorate, on the whole they come up with sensible results. Sometimes I like the results, and sometimes I hate them, but I support the right of the electorate to decide those results.

Mr. Loughton: This has been an entertaining debate, which has often been about something else, but the issue that we should have been debating—put in its simplest terms—is the people's choice against the party's choice.
Despite the constant debating of the subject, wherever I speak to well-informed people, I am amazed that t c he vast majority are blissfully unaware that they will not be able to vote for the candidate of their choice when they go to the polls at the European election next June. There is enormous ignorance of the reality of what is being debated and of what will result if the Bill is passed in this form.
People in this country like to think that they have some control over the candidate who represents them, that they have a link with that representative, that they know their representative's name, and that, if push came to shove, they could speak to, or get rid of, that representative.
That may be a slightly rose-tinted view of the way in which our democracy works, but most British people take comfort from that state of affairs. Suggesting that they are not up to the job of selecting their first-choice candidate to represent them—in Europe, in Wales, in Scotland or in Westminster—shows utter contempt for the ordinary people of this country.
The Home Secretary argued on numerous occasions that all that is pointless, because candidates will be virtually anonymous in these huge European regions, and are virtually anonymous as Members of the European Parliament for the smaller constituencies at present, but that they will be wholly anonymous in a constituency which—in my part of the country, for example—will encompass 5.9 million people and elect 11 representatives. Goodness knows where someone will go for a surgery to see one of the MEPs in such a large area.
That is a fallacious argument, however: it suggests that, because they will be anonymous, we may as well condemn all MEPs to a lifetime of anonymity through being a person on a closed list. That will not improve the turnout at European elections, which has been the raison d'être for reforming the system. It will make people feel more detached and more remote from their MEP, whom they could not vote for as a person.
As many hon. Members have said, the problem is that many of the least anonymous candidates in the Labour party tend to be those who are most out of line with Millbank tower, which is what the argument is about. The closed-list system is designed entirely to suit the internal machinations of the governing party.
We have heard about the strange goings on behind closed doors in respect of the Welsh list, after which the top candidate chosen by members of the Labour party in Wales mysteriously dropped well down the list. A small number of regional representatives and members of the Labour party national executive committee decided who went on that list and in what order.
Do I detect a small chink in that control freak mentality, at least in Wales, with the story that the members of the Labour party in Wales may get one person, one vote, to select the leader of the Welsh Assembly, should he or she happen to be a member of the Labour party? If that is the case, it is a welcome development, albeit late in the day. It follows the example set by Conservative Members many months ago, when we went for one person, one vote. All the candidates on Conservative party lists up and down the country were selected under a system whereby every member of the Conservative party in each region had the opportunity to cast an equal vote for a candidate to decide where on the list they were placed.

Mr. Martin Salter: Does the hon. Gentleman accept that that is nonsense? In my part of the world, members from Berkshire had to travel to a caucus meeting in docklands to deselect their MEP. It was not one member, one vote. Only one party has offered that system: the Liberal Democrat party.

Mr. Loughton: If the argument in favour of the legislation is that a bus journey to docklands is too far, that is a fairly sorry state of affairs. It was not a caucus meeting; every paid-up member of the Conservative party in the south-east region was able to attend the meeting and cast an equal vote.


I wonder whether the hon. Gentleman will reply to the question I posed earlier. How many members of his party had an equal vote in the selection of the Labour party candidates who will be set against the Conservative party candidates in my region? Can we count them on one or two hands? We cannot count them, because we do not know who selected those candidates, how many people made the selection and on what basis. Perhaps they used a ouija board. Did they get pager messages from Millbank tower? Did the Prime Minister appear and say, "These are the people I want to appear on the list"? We do not know.
The Labour party has dismally failed to tell us how it selected its candidates. How Labour Members have the audacity to claim that they have a better system than the wholly democratic one person, one vote system used by the Conservative party beggars belief.

Mr. Allan: I am sure that the hon. Gentleman took part in the democratic exercise to select his party's candidate. I hope that he will confirm that the Conservatives have selected candidates who will serve the public in a genuine spirit of public service, and not be merely party hacks. Some of the tone of the debate is insulting to candidates, because it suggests that they will have no notion of serving the public in their larger regions. That is not true in the Liberal Democrat party.

Mr. Loughton: That is a bit rich, given that the Liberal Democrats used a hybrid zipper system to choose a small number of female candidates. They feel guilty because they so dismally failed to get many female MPs elected at the last general election [Interruption.] The Conservative party made no pretence about trying to fix the list. In the London region, a woman who is certainly no party apparatchik came top of the list, and good luck to her. Her name is Villiers—I shall give her that extra bit of publicity to promote her chances at the election next year. There was no prospect of party apparatchiks getting any favours. In fact, the list shows that the opposite was true.
It is appropriate that, on 6 December, we celebrate—or perhaps do not celebrate—the 250th anniversary of Pride's purge. Under Cromwell, Members of the House who happened to be out of tune with the Commonwealth Government of the day mysteriously disappeared from these Benches. We have a lesson to learn, because, 250 years on, history seems to be repeating itself on the Labour Benches.
I return to this little chink of light. On 12 November 1997—a year ago—the Home Secretary said:
We are a party and a Government who listen to argument.
Let them prove that this evening. They have repeated the absurd suggestion that all will be well because we will have another review. As the hon. Member for Great Grimsby (Mr. Mitchell) said, the review will take place after the changes have happened.
Can any Labour Member name a European country that changed its electoral system and six months later had a review about changing it back? It does not happen like that. The right thing to do would be to keep the status quo until next year's elections, and then review it—if that really is the Government's intention.
It is absurd to insist on a closed-list system that, in the end, would probably make little difference to the way in which party votes fell. Moreover, there is no need to fall into line totally with other European states for the purpose

of these elections. There is a multiplicity of different electoral systems. As I have said, we do not even have a commonality between the parties in regard to the way in which candidates are selected—although, if we are a progressive House moving towards more democratic accountability, I expect that the Conservative model will be emulated by all the other parties.
9.30 pm
Another absurdity is that the Labour party's manifesto at the last election expressed no preference for a particular type of proportional representation. Labour cannot even claim that it is only living up to its manifesto commitments—although we know that it is not very good at doing that, anyway. Besides, the proposed system goes against the Jenkins report. Conservative Members disagree with the thrust of that report, but the one thing to which it holds dear is an open-list system and some contact with the individual Member. That, at least, Lord Jenkins has tried to preserve.
The truth is that this whole debate has become a convenient way of bashing the House of Lords, just as foxhunting was some months ago. In fact, the noble Lords are doing their job, and doing it rather well. They have been representing the views of the electorate rather closely—on student tuition fees, the age of consent and, in this instance, the people's right to vote for people, not parties. But, if we are to accept what we are being fed by the Government, their Lordships have already been dismissed. They have already been summarily executed.
Labour Members might do well to listen to some of the wise words that were spoken in the House of Lords just a few days ago. Lord Shaw said:
So the argument that it is simply a matter of elected Commons versus unelected Peers and that the unelected Peers, because they are dominated by hereditary Conservative Members, should always be brushed aside, is not in itself strong enough."—[Official Report, House of Lords, 12 November 1998; Vol. 594, c. 851.]
He is right. The idea that anything said in the House of Lords does not matter is absurd. It is ironic that the unelected Lords should be most in tune with the democratic principles that are held dear by the majority of democracy-loving people.
It is time to show that the Home Secretary does listen, not just to the majority in the upper House but to the silenced voices on his own Benches, and elsewhere among the majority of his own party members in the country at large.

Mr. Barnes: I wish to make only two brief points. One relates to the peculiar argument advanced by the Home Secretary and Liberal Democrats, that there can be such a thing as a closed list of one. I accept that one person can be foisted on the electorate, just as a list of people can be foisted on the electorate. They can be foisted by a decision of the party—by one member, one vote, or what you will—or by the bureaucracy of the party. Both lists and individuals can be foisted on people who will not have much choice if they want to vote for the party concerned.
The phrase "a closed list of one", however, is very odd. I do not have a very good memory, so when my wife sends me shopping, she gives me a list. Even my memory, however, is not so bad that my wife will give me a shopping list containing only one item. I therefore found it strange that an argument should be advanced whose aim


seemed to be to confuse the two systems. It is not logically possible to have a closed list of one. It is neither false nor true to say that it is possible; the idea is simply meaningless nonsense.
A closed list means something in comparison with an open list, and there is no way in the world or in logic that we can have an open list of one. As we have agreed, one candidate can be foisted on people whatever the method that has been chosen, so I hope that my right hon. Friend the Home Secretary and the Liberal Democrats will stop speaking in ways that are entirely meaningless. If they mean to say something else—this is the point that I first made—about it being possible for people to be foisted on the electorate, whether as individuals or as candidates on the lists, they should say that, but they should not try to invent a type of language that finishes up saying nothing.

Mr. Allan: Aside from the semantic argument, we are simply trying to make the point that there would be an alternative, and it is the logical outcome of that proposed by the proponents of the amendment. To follow the same logic that they are using in this debate, in first-past-the-post elections, each party should put forward a list of several candidates, and the highest one should get selected. I apologise for any semantic confusion that was caused.

Mr. Barnes: It is a matter not of semantics, but of meaning. I do not think even politicians should say things that are meaningless, although they happen to feel that they say something. It may be that, in the era of spin doctors, we are given to that, but we should be considerably aware of it.
My second point is about why I am abstaining on all this to-ing and fro-ing with the other place. It is because I oppose lists, whether they are open lists or closed lists. I agree that a closed list can emerge because it has been democratically determined by membership within a party, by delegatory or by individual vote means; it can also be foisted on people.
Nevertheless, a closed list is presented to people, and there is no opportunity to make any choice between the half dozen or so candidates that are presented. However, if we had an open list and we could choose between the half dozen, that would produce other problems. As occurs with the single transferable vote system in the Republic of Ireland, members of the same political party would be in contest with one another to get higher up the list and to get the vote compared with someone else.
I do not think that that is a good thing for political parties, or for democracy generally. We can fight each other enough within the Labour party without organising it for electoral arrangements. Why should we institutionalise conflict? The conflict that the Conservative party had, and still has, over Europe—why should we extend that to the ballot box, to allow the choice then to be made by the electorate in going for one person or another? It is a matter that the parties need to sort out by their different representatives as to what their general position is, which they should then put before an electorate.
Therefore, I do not like lists. There are other forms of proportional representation in which lists are not things that are put to the electorate. Lord Jenkins' report refers

to a system that the Hansard Society suggested on one occasion, that of the fastest loser. We can top systems up out of the votes that have taken place in constituencies by the people who came nearest to taking those seats in the election.
Something like that might be possible. It does not refer to the situation that is before us now, because we have no choice. Those of us who dislike this type of proportional representation, or think that first past the post is better than some other forms of proportional representation, have nothing else to do in these debates but to continue abstaining in a principled way—something that the Liberal Democrats used to know about at one time.

Miss Anne McIntosh: The hon. Member for North-East Derbyshire (Mr. Barnes) may have struck a chord with the House—perhaps he will also with future electorates and Labour party candidates—by being so confident as to say that he, like other Labour Members, will abstain in today's Division. If a closed-list system were ever introduced for elections to the House, I am not sure that they would feel quite so confident in making such a statement.
The Government are today stuck between a rock and a hard place. The rock is the open list, and the hard place is the current first-past-the-post system. The Home Secretary said that Conservative Members should follow Lord Bethell's advice, which was published in an open letter in today's The Daily Telegraph. I wonder whether the Home Secretary and other Ministers would like to follow the advice given by Mr. Henry McCubbin—who was the former Labour Member of the European Parliament for north-east Scotland from 1989 to 1994—in a letter to my noble Friend Lord Mackay of Ardbrecknish.
Mr. McCubbin wrote to Lord Mackay—the letter was used last week in a debate in the other place-that Rule 2 of the European Parliament's rules, under the heading "The independent mandate", clearly states:
Members of the European Parliament shall exercise their mandate independently. They shall not be bound by any instructions and shall not receive a binding mandate.
Therefore, that honourable gentleman, who—in his own rather eloquent words—had dropped out of the "comfort zone" and been excluded from the closed list, would stand to gain quite substantially if the House votes, and the other place continues to vote, for an open list system.
Mr. McCubbin wrote to my noble Friend Lord Mackay simply to say:
To my mind the open list is the only way to meet this simple but important criteria",
and has written to the Lords to
support the Lords amendment to provide for open lists"—[Official Report, House of Lords, 12 November 1998; Vol. 594, c. 849]
in the hope that sufficient peers would follow that suggestion.
I am one of only three dual mandate Members and, on personal experience, can put Ministers' minds to rest on the matter of voter recognition, which certainly exists. On leaving this place and arriving on a train, at 12.30 in the morning, at the constituency of the hon. Member for Colchester (Mr. Russell), I was picked up by a taxi driver who was rather concerned that I had nowhere to stay that night. However, when I assured him that I was not only the Member of Parliament for the Vale of York but a


Member of the European Parliament for that constituency, he got part of my name right and called me Anne. He could not quite get the second part of my name right, but then he was not voting that night.
If a taxi driver in Colchester town knows who his MEP is, that is good enough for me.
The right hon. Member for Chesterfield (Mr. Benn) has struck a chord with the House today. We know that the only beneficiaries in the House today are the Members of one small group—the Liberal Democrats—and that the proposals are the prelude for proportional representation being introduced, perhaps on a similar basis, for elections to the House.
If first past the post has been and still is good enough for this place, why should it not be good enough—as it has been since 1979—for electors to the European Parliament? What are Ministers so afraid of? They speak so often of Labour being the people's party and of creating a people's Britain. This is the one occasion on which we can allow voters to make the people's choice. Let the people choose.
It is not really a question of the Lords versus the Commons. As my hon. Friend the Member for East Worthing and Shoreham (Mr. Loughton) said today, throughout this whole experience—my hon. Friend the Member for Mid-Bedfordshire (Mr. Sayeed) called it "the shuttlecock procedure"—the Lords have been more in tune with voters than Ministers have. Ministers are so out of tune on the matter, that, on reflection, they may want to leave the rock and the hard place and join Conservative Members in voting for nothing more simple or clear than an open list. As the Lords stated, electors should be able not only to vote for a party but to state their own personal preference of candidate. Let the people decide.

Mr. Stephen Twigg: We have heard a great many romantic notions from Conservative Members about the present set-up. I am delighted that the hon. Member for Vale of York (Miss McIntosh) was identified late at night, at least by her first name, by a taxi driver in her European constituency.
Listening to Conservative Members, one would believe that this country had the highest turnout in the European Union at the European elections, rather than one of the lowest, and that everyone knew the name of his Member of the European Parliament. I would stick my neck out and say that the majority would not know the name of their Member of the European Parliament. I would make an exception for my own excellent MEP, Pauline Green, the leader of the Socialist group in the European Parliament. I am delighted that she is also No. 1 on the Labour list for London, and look forward to her continuing to represent the people of my constituency in the European Parliament.
I shall concentrate on three points. First, it is worth reminding ourselves of the Bill's purpose, which is to give fair representation to voters across the country. I contest the view that the beneficiaries of the proposed system will be any one political party. I think that the beneficiaries will be voters who do not currently have a voice in the British delegation to the European Parliament, whether they be Liberal Democrat voters in Greater London, Labour voters in many of the home counties or Conservative voters in Scotland and Wales. The Bill deals

with what the Jenkins report identified as electoral deserts, which are those large parts of the country where significant groups of voters have no representation. It is for that reason that the Bill should become law as soon as possible.
Secondly, when we debated the Jenkins report in the House a couple of weeks ago, hon. Members of all parties accepted that there is no such thing as a perfect voting system. Every voting system has its advantages and disadvantages, and we should bear that in mind tonight.
Thirdly, at an earlier stage of our consideration of the Bill, we considered proposals, put to us by the Liberal Democrats and endorsed by organisations such as Charter 88, for a partial open system—the so-called Belgian system. Many of us felt that that option had merits, and said so in this place and elsewhere. Unfortunately, we did not proceed with that proposal. I welcome the Government's proposal for a review, which will enable us to consider the issue again after the elections.

Mr. Lansley: Does not the hon. Gentleman realise that, should the Government choose to do so, they could, with their order-making powers, get something very close to the Belgian system by using the open-list system set out in the Lords amendment?

Mr. Twigg: That point was not made by the hon. Gentleman or any of his colleagues when the proposal was before the House. The hon. Gentleman's proposal and that being considered now are very different. The Lords proposal is essentially a wrecking amendment from people who want the first-past-the-post system to be retained in the European elections.
I want to take up the point about closed lists of one. It is appropriate to talk about the first-past-the-post system as a closed list of one. The purpose of an open list is to enable the voter to have a choice of different candidates, including different candidates from the same party. The argument against a closed list is that it does not give that choice. For example, a Labour voter in my constituency who does not want to vote for me either has to vote for me with gritted teeth or does not vote Labour. It is therefore perfectly legitimate to argue that we have a closed system with first past the post.

Mr. Barnes: Will my hon. Friend say how we could have an open list of one?

Mr. Twigg: Of course we could have a system whereby the parties offered a range of candidates and the voters were allowed to decide among them. The logic is the same as that deployed by those arguing for the Lords amendment. [Interruption.] I am being asked to wind up so I shall do so.
We have an opportunity to pass a Bill that will be an important part of the Government's constitutional reform programme. We have an undertaking in the amendment tabled by my right hon. Friend the Home Secretary that there will be a review and that Opposition parties will be consulted. That should be welcomed. The House of Lords has had its chance. The will of the House of Commons should prevail. The Bill is a significant democratic reform, which I hope will be supported by hon. Members of all parties.

Mr. James Clappison: We have had a good debate, and a good-humoured one. We have gone over well-trodden ground, but we have once again heard widespread concern about and hostility towards the Government's proposal for a closed-list system. It is striking that the hostility has become greater and greater during debates on this matter, not least on the Government side of the House. We have heard hon. Member after hon. Member speak with great feeling against the closed-list system and in favour of the principle of the open-list system. I have listened carefully tonight to each speech from the Labour Benches, and not one of them favoured the closed-list system in principle over the open-list system.
The right hon. Member for Chesterfield (Mr. Benn) gave a speech that the House enjoyed. He set out his five principles of democratic choice, as he put it, and it was clear that the system proposed by the Government did not fulfil any of his criteria. In particular, he rightly said that it is impossible under a closed-list system for a voter to use the ballot box to get rid of a Member of whom he or she disapproves.
I thought that the hon. Member for Battersea (Mr. Linton) would be a supporter of the closed-list system when he began to speak. However, he said, during his speech and in clarifying an intervention later, that he favoured the open-list system over the closed-list system. His logic was not entirely clear, but I do not want to be unfair to him. I did not follow his point about the danger of having members of other political parties voting in a party's internal elections of candidates. There is no risk of our having anything like the American system in which, for example, Republicans can vote for Democrats. There is, at least, no risk of that in the Labour party, which will not allow even its own members to vote to choose a candidate. Late in the hon. Gentleman's speech, it emerged that he has serious concerns about the way in which Labour is proceeding, and that he has protested to the national executive committee.
The House also enjoyed the speech of the hon. Member for Great Grimsby (Mr. Mitchell). I gather that he is now communing with a cup of tea, but we understood his strong feeling against the closed-list system. He said that he would abstain, but that the closed-list system is futile and will, in his words, cause festering resentment. The Home Secretary will have been pleased to hear of the hon. Gentleman's personal admiration for him. The hon. Gentleman also said that he was a safe pair of trousers. Notwithstanding all his efforts to get into his party's good books, however, the hon. Gentleman could not bring himself to support the closed-list system.
The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) spoke with considerable passion about her support for the open-list system, and about the need for the electorate to have a direct link with its representative. The hon. Member for North-East Derbyshire (Mr. Barnes) also spoke passionately on that theme.
The hon. Member for Enfield, Southgate (Mr. Twigg) seemed at one point to be a late entrant as a supporter of the closed-list system, but even he managed—

diplomatically—to qualify his speech. He said that he would have preferred the Government to take another course, and that he preferred the open-list principle.

The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth): No, he did not.

Mr. Clappison: The hon. Member for Enfield, Southgate said that the Government had taken an unfortunate decision at an earlier stage, and that he supported the Belgian system—a semi-open form of list—in principle. The fact that the Minister seeks comfort in that makes it plain how desperate the Government Front-Bench team has become in its search for support.
There was, of course, no support for the Government from the Conservative Benches. My hon. Friend the Member for Mid-Bedfordshire (Mr. Sayeed) made a very good speech in which he drew fairly attention to widespread concern about and lack of support for the Government's proposals in the other place. My hon. Friend the Member for Worthing, West (Mr. Bottomley) made the important point that the Bill was not a minor detail. When history comes to be written, historians will, as my hon. Friend asserted, argue that the Government acted wrongly, and that they set a bad precedent for our electoral system by depriving voters of choice.
My hon. Friend the Member for East Worthing and Shoreham (Mr. Loughton) also made a good point in asking why Members of the European Parliament should be condemned to a life of anonymity through the use of a list, rather than being able to create a direct link with the electorate. The same point has been made by many others, including my hon. Friend the Member for Vale of York (Miss McIntosh), who spoke from experience to show that voter recognition can exist.
In response to all that condemnation of the course that he has taken, the Home Secretary, in a speech that was perhaps not as good humoured as some of his earlier contributions to this debate—we can forgive him, because we have been over this course so often—gave up any pretence of making an argument on the subject. He did not try to build a case on the evidence but simply showed brass neck and what the hon. Member for Battersea described as chutzpah. He advanced ludicrous arguments.
The Home Secretary said that this was all a conspiracy got up by the Conservative party. He called it a conspiracy of non-understanding. If it was all got up by the Conservative party and the hereditary peers, I have to say that it extends to many groups and individuals not normally associated with the Conservative party. There has been widespread concern across many different groups about the Government's course.
Concern extends to Charter 88, whose briefing when the matter was first proposed last autumn said:
We believe that the closed list system originally proposed in the Bill where voters can only put their cross next to the party name should be replaced with a more open list system.
The Electoral Reform Society expressed a similar view. Its president, Earl Russell, is a member of the Liberal Democrat party.

Mr. Allan: A fine man.

Mr. Clappison: He was fine in that he had the courage to vote against the Government's proposal, against the Whip put on by the Liberal Democrats.
Concern extends to many in the media. Last October, when the proposals were first unveiled, The Times said that they were bad for democracy and would be bad eventually for the parties too. It described it as the worst possible kind of proportional representation for the European elections and said that it would result in placemen being put in the European Parliament, rather than individual representatives. The Times is also part of the conspiracy.
The Home Secretary reached his most ludicrous when he said that the idea that the closed list is anathema to our system of politics was pure nonsense. He forgets what he said last October in a leaked letter to a colleague reported in The Guardian. In setting out the case for a closed-list system, he said:
though this is not a term which I think we should use.
The conspiracy of non-understanding may even extend to the Home Secretary himself.
The Home Secretary went on to say that, despite all our concerns, we have to agree because their manifesto commits the Government to the closed-list system. The Labour party manifesto is not something that I normally carry around with me, but I have been helpfully furnished with a copy. It states:
We have long supported a proportional voting system for election to the European Parliament.
There is no mention of the closed-list system and no reason why there should not be an open-list system. At least eight other members of the European Union have open-list systems that would have been compatible with that pledge. Why, out of all the systems that the Government could have chosen, did they choose one that maximised party control?
We think that the answer is clear, and it was given by another member of the Conservative hereditary peers' conspiracy against the Government, Lord Shore. He said:

The issue is about the open list against the closed list. It is about an open democratic list against a closed party management list. It is about accountability to the electorate, to the voters, against accountability to a party committee".—[Official Report, House of Lords, 12 November 1998; Vol. 594, c. 851.]
That view has been echoed time and again through our debates.
We cannot accept the latest review put forward by the Government. We regarded their original concession—it was described as a concession—as so minimal as to be meaningless. Their new concession is ludicrous. They now say that, in addition to the review of the operation of the closed-list system, we should have one of the operation of the open-list system. How can a review be conducted when that system is not operating? We welcome the fact that there will be consultation on who will chair the review, but we wonder what on earth it will find to do. All the evidence that will be available in six months' time is available now. It is a matter of principle, and the Government have come down on the wrong side. They have come down in favour of party control, rather than representative democracy—not voter choice, but control by the party bosses.
We hope that the closed-list system is not a harbinger of things to come, because it is bad in every conceivable respect from beginning to end. The debate and the Government's proposal are about promoting party control over individual choice and representative democracy. The proposal is a thoroughly bad thing and we are fully entitled to continue opposing it.

It being Ten o'clock, the debate stood adjourned.

BUSINESS OF THE HOUSE

Motion made, and Question put forthwith, pursuant to Standing Order No. 15 (Exempted business),
That, at this day's sitting, the Regional Development Agencies Bill and the European Parliamentary Elections Bill may be proceeded with, though opposed, until any hour.—[Mr. Mike Hall.]

Question agreed to.

European Parliamentary Elections Bill

Lords Reasons for insisting on certain of their amendments to which the Commons have disagreed and for disagreeing to the Commons amendment to the Bill in lieu, again considered.

Question again proposed, That this House insists on its disagreement with the Lords in their amendments, but does not insist on its amendment in lieu.

Mr. George Howarth: I should correct the hon. Member for Hertsmere (Mr. Clappison) on one point. He said that we had produced the review system at the last minute. In fact, it is in response to a request from the hon. Gentleman and the right hon. Member for Sutton Coldfield (Sir N. Fowler) some time ago. We thought that it was a reasonable request—[Interruption.] The hon. Gentleman asks for something and is granted it. Then, most ungratefully, he laughs at our agreeing to his request.
The Opposition should acknowledge that we have said that they will be consulted about the way in which the process works, and we mean that sincerely. There is a real point to having a review. They asked for it and I hope that they will be good enough to acknowledge that.
It is customary to begin by saying that we have had a good debate. On this occasion, perhaps I will be forgiven for saying that it has been an interesting debate. We have certainly heard some good speeches, and I shall refer to one or two in a moment, but frankly, the debate has not moved on a great deal since Second Reading. Opposition Members have their view and we have ours, and there does not seem to have been a meeting of minds. If they have doubts about whether the Bill has been debated thoroughly, I remind them that the House has debated it on Second Reading, in Committee and on Report and has considered Lords amendments for a total of 31 hours and 45 minutes. I would have thought that almost everything that could have been said about the Bill, and the choice of an open or closed-list system, had been said.

Mr. Peter Bottomley: Could the Minister say which Labour Back Benchers would support the Government policy on a free vote?

Mr. Howarth: The hon. Gentleman asks a silly question. I wonder whether he could tell me how many of his colleagues would have voted in the poll tax had they had a free vote on it when they were in government. It is the same principle. We were elected on a manifesto commitment to introduce a proportional system for European elections and that is what we will deliver.

Mr. John Randall: Will the Minister give way?

Mr. Howarth: No. Let us not forget that, had it not been for the stubbornness of the unelected second Chamber, we would not be debating this matter for the fourth time tonight. Conservative Members have advanced no new arguments tonight. Nor have they made any attempt to explain how the perverse results that an open-list system can produce—[Interruption.]

Mr. Deputy Speaker: Order. The House must come to order. There are far too many conversations going on in the Chamber.

Mr. Howarth: Nor has anyone explained how the perverse results that my right hon. Friend the Home

Secretary has repeatedly explained could possibly be justified to the electorate in the circumstances that he described earlier. Quite honestly, the discovery that the person who got the most votes in such a system was not elected would be met by bafflement among the electorate—and rightly so.
There has not been any sort of answer to the damning admission made by Lord Bethell, himself a former and aspiring Member of the European Parliament, whose words my right hon. Friend the Home Secretary quoted at the start of the debate, that he and his fellow Conservative hopefuls in London would be known only to the tiniest fraction of the electorate. I might add that, as a result of his being frequently mentioned in tonight's debate, Lord Bethell is probably rather better known now than he was before he wrote that letter.
The Government remain firmly convinced that the closed-list system is the most fair and appropriate system for Britain to use to elect its MEPs. It is easy to use and produces fair and clear results. We also remain convinced that this House must prevail over the other place, which, for all its undoubted merits in other respects, has been elected by no one and lacks any democratic legitimacy.
We listened to the views of the other place, and first introduced and then strengthened the review clause. We hope that the other place will now return the favour and listen to the clear and unambiguous message which is the will of this House—[Interruption.] If Conservative Members doubt that, I suggest that they look to see who goes into which Lobby tonight. The result will be the expression of the will of this House—an expression of which the Lords will take notice. A combination of the unelected in the House of Lords and the unelectable sitting on the Conservative Benches here will not thwart the will of this House.

Question put:—

The House divided: Ayes 309, Noes 122.

Division No. 377]
[10.6 pm


AYES


Abbott, Ms Diane
Brown, Russell (Dumfries)


Adams, Mrs Irene (Paisley N)
Browne, Desmond


Ainger, Nick
Buck, Ms Karen


Ainsworth, Robert (Cov'try NE)
Burden, Richard


Allan, Richard
Burgon, Colin


Allen, Graham
Burstow, Paul


Anderson, Donald (Swansea E)
Butler, Mrs Christine


Armstrong, Ms Hilary
Caborn, Richard


Ashdown, Rt Hon Paddy
Campbell, Alan (Tynemouth)


Atherton, Ms Candy
Campbell, Mrs Anne (C'bridge)


Austin, John
Campbell, Menzies (NE Fife)


Banks, Tony
Campbell, Ronnie (Blyth V)


Barron, Kevin
Campbell-Savours, Dale


Battle, John
Caplin, Ivor


Bayley, Hugh
Casale, Roger


Beard, Nigel
Caton, Martin


Beth, Rt Hon A J
Chapman, Ben (Wirral S)


Bell, Stuart (Middlesbrough)
Chisholm, Malcolm


Benton, Joe
Clapham, Michael


Bermingham, Gerald
Clark, Rt Hon Dr David (S Shields)


Berry, Roger
Clark, Dr Lynda


Blackman, Liz
(Edinburgh Pentlands)


Blears, Ms Hazel
Clark, Paul (Gillingham)


Boateng, Paul
Clarke, Eric (Midlothian)


Bradley, Keith (Withington)
Clarke, Rt Hon Tom (Coatbridge)


Bradley, Peter (The Wrekin)
Clarke, Tony (Northampton S)


Bradshaw, Ben
Clelland, David


Brinton, Mrs Helen
Coaker, Vernon






Coffey, Ms Ann
Hewitt, Ms Patricia


Cohen, Harry
Hill, Keith


Coleman, Iain
Hinchliffe, David


Connarty, Michael
Hoey, Kate


Cooper, Yvette
Home Robertson, John


Corbett, Robin
Hood, Jimmy


Cotter, Brian
Hoon, Geoffrey


Cranston, Ross
Hope, Phil


Crausby, David
Hopkins, Kelvin


Cryer, John (Hornchurch)
Howarth, Alan (Newport E)


Cummings, John
Howarth, George (Knowsley N)


Cunliffe, Lawrence
Howells, Dr Kim


Cunningham, Jim (Cov'try S)
Hoyle, Lindsay


Cunningham, Ms Roseanna
Hughes, Ms Beverley (Stretford)


(Perth
Hughes, Kevin (Doncaster N


Curtis-Thomas, Mrs Claire
Humble, Mrs Joan


Dafis, Cynog
Hurst, Alan


Dalyell, Tam
Hutton, John


Darling, Rt Hon Alistair
Illsley, Eric


Darvill, Keith
Jackson, Ms Glenda (Hampstead)


Davey, Valerie (Bristol W)
Jackson, Helen (Hillsborough)


Davidson, Ian
Jamieson, David


Davies, Geraint (Croydon C)
Jenkins, Brian


Dawson, Hilton
Johnson, Alan (Hull W & Hessle)


Dean, Mrs Janet
Johnson, Miss Melanie


Denham, John
(Welwyn Hatfield)


Dismore, Andrew
Jones, Barry (Alyn & Deeside)


Dobbin, Jim
Jones, Helen (Warrington N)


Donohoe, Brain H
Jones, Ms Jenny


Dowd, Jim
(Wolverh'ton SW)


Drew, David
Jones, Jon Owen (Cardiff C)


Drown, Ms Julia
Jones, Martyn (Clwyd S)


Eagle, Angela (Wallasey)
Keen, Alan (Feltham & Heston)


Eagle, Maria (L'Pool Garston)
Keen, Ann (Brentford & Isleworth)


Edwards, Huw
Kemp, Fraser


Ellman, Mrs Louise
Kennedy, Jane (Wavertree)


Ennis, Jeff
Khabra, Piara S


Etherington, Bill
Kidney, David


Ewing, Mrs Margaret
Kilfoyle, Peter


Fisher, Mark
King, Andy (Rugby & Kenilworth)


Fitzpatrick, Jim
Kingham, Ms Tess


Fitzsimons, Lorna
Kumar, Dr Ashok


Flint, Caroline
Ladyman, Dr Stephen


Flynn, Paul
Lawrence, Ms Jackie


Follett, Barbara
Laxton, Bob


Foster, Rt Hon Derek
Leslie, Christopher


Foster, Michael Jabez (Hastings)
Levitt, Tom


Foster, Michael J (Worcester)
Lewis, Ivan (Bury S)


Fyfe, Maria
Lewis, Terry (Worsley)


Galbraith, Sam
Linton, Martin


Galloway, George
Lloyd, Tony (Manchester C)


Gapes, Mike
Llwyd, Elfyn


George, Bruce (Walsall S)
Lock, David


Gerrard, Neil
Love, Andrew


Gibson, De Ian
McAvoy, Thomas


Gilroy, Mrs Linda
McCabe, Steve


Godman, Dr Norman A
McCafferty, Ms Chris


Godsiff, Roger
McDonagh, Siobhain


Goggins, Paul
Macdonald, Calum


Golding, Mrs Llin
McGuire, Mrs Anne


Griffiths, Jane (Reading E)
McIsaac, Shona


Griffiths, Nigel (Edinburgh S)
Mackinlay, Andrew


Griffiths Win (Bridgend)
McNulty, Tony


Grocott, Bruce
MacShane, Denis


Grogan, John
Mactaggart, Fiona


Gunnell, John
McWalter, Tony


Hall, Mike (Weaver Vale)
McWilliam, John


Harvey, Nick
Mahon, Mrs Alice


Heal, Mrs Sylvia
Mallaber, Judy


Healey, John
Marsden, Gordon (Blackpool S)


Health, David (Somerton & Frome)
Marshall, David (Shettleston)


Henderson, Doug (Newcastle N)
Martlew, Eric


Henderson, Ivan (Harwich)
Meale, Alan


Hepburn, Stephen
Merron, Gillian


Heppell, John
Michie, Mrs Ray (Argyll & Bute)


Hesford, Stephen
Milburn, Alan





Miller, Andrew
Smith, Angela (Basildon)


Moffatt, Laura
Smith, Jacqui (Redditch)


Moore, Michael
Smith, John (Glamorgan)


Morgan, Ms Julie (Cardiff N)
Soley, Clive


Morgan, Rhodri (Cardiff W)
Southworth, Ms Helen


Morley, Elliot
Squire, Ms Rachel


Morris, Ms Estelle (B'ham Yardley)
Starkey, Dr Phyllis


Morris, Rt Hon John (Aberavon)
Steinberg, Gerry


Mullin, Chris
Stevenson, George


Murphy, Denis (Wansbeck)
Stewart, David (Inverness E)


Murphy, Jim (Eastwood)
Stewart, Ian (Eccles)


Naysmith, Dr Doug
Stoate, Dr Howard


Norris, Dan
Strang, Rt Hon Dr Gavin


O'Brien, Bill (Normanton)
Straw, Rt Hon Jack


O'Brien, Mike (N Warks)
Stringer, Graham


Olner, Bill
Stuart, Ms Gisela


O'Neill, Martin
Stunell, Andrew


ÖPik,Lembit
Sutcliffe, Gerry


Organ, Mrs Diana
Taylor, Rt Hon Mrs Ann


Osborne, Ms Sandra
(Dewsbury)


Palmer, Dr Nick
Taylor, Ms Dari (Stockton S)


Pearson, Ian
Temple-Morris, Peter


Pendry, Tom
Thomas, Gareth (Clwyd W)


Pickthall, Colin
Thomas, Gareth R (Harrow W)


Pike, Peter L
Timms, Stephen


Plaskitt, James
Tipping, Paddy


Pollard, Kerry
Todd, Mark


Pond, Chris
Touhig, Don


Pope, Greg
Trickett, Jon


Pound, Stephen
Truswell, Paul


Prentice, Ms Bridget (Lewisham E)
Turner, Dennis (Wolverh'ton SE)


Prentice, Gordon (Pendle)
Turner, Dr Desmond (Kemptown)


Prescott, Rt Hon John
Turner, Dr George(NW Norfolk)


Prosser, Gwyn
Twigg, Derek (Halton)


Purchase, Ken
Twigg, Stephen (Enfield)


Radice, Giles
Tyler, Paul


Rammell, Bill
Vaz, Keith


Rapson, Syd
Wallace, James


Reed, Andrew (Loughborough)
Ward, Ms Claire


Robertson, Rt Hon George
Wareing, Robert N


(Hamilton S)
Watts, David


Rooker, Jeff
Webb, Steve


Rooney, Terry
Welsh, Andrew


Ross, Ernie (Dundee W)
White, Brian


Roy, Frank
Whitehead, Dr Alan


Ruane, Chris
Wicks, Malcolm


Russell, Ms Christine (Chester)
Williams, Alan W (E Carmarthen)


Ryan, Ms Joan
Wills, Michael


Salter, Martin
Winterton, Ms Rosie (Doncaster C)


Sawford, Phil
Worthington, Tony


Sedgemore, Brian
Wright, Anthony D (Gt Yarmouth)


Shaw, Jonathan
Wyatt, Derek


Sheerman, Barry
Tellers For the Ayes:


Sheldon, Rt Hon Robert
Mr. David Hanson and


Smith, Rt Hon Andrew (Oxford E)
Mr. Clive Betts.




NOES


Ainsworth, Peter (E Surrey)
Chapman, Sir Sydney


Amess, David
(Chipping Barnet)


Ancram, Rt Hon Michael
Chope, Christopher


Arbuthnot, Rt Hon James
Clappison, James


Atkinson, Peter (Hexham)
Clarke, Rt Hon Kenneth


Baldry, Tony
(Rushcliffe)


Bercow, John
Cormack, Sir Patrick


Beresford, Sir Paul
Cran, James


Blunt, Crispin
Davies, Quentin (Grantham)


Body, Sir Richard
Day, Stephen


Boswell, Tim
Duncan Smith, Iain


Bottomley, Peter (Worthing W)
Evans, Nigel


Bottomley, Rt Hon Mrs Virginia
Faber, David


Brady, Graham
Fabricant, Michael


Brazier, Julian
Flight, Howard


Browning, Mrs Angela
Forth, Rt Hon Eric


Burns, Simon
Fowler, Rt Hon Sir Norman


Butterfill, John
Fox, Dr Liam






Fraser, Christopher
Ottaway, Richard


Gale, Roger
Page, Richard


Gibb, Nick
Paice, James


Gill, Christopher
Pickles, Eric


Gillan, Mrs Cheryl
Prior, David


Gorman, Mrs Teresa
Randall, John


Gray, James
Redwood, Rt Hon John


Green, Damian
Robertson, Laurence (Tewk'b'ry)


Greenway, John
Rowe, Andrew (Faversham)


Grieve, Dominic
Ruffley, David


Hamilton, Rt Hon Sir Archie
St Aubyn, Nick


Hammond, Philip
Sayeed, Jonathan


Hawkins, Nick
Shephard, Rt Hon Mrs Gillian


Hayes, John
Shepherd, Richard


Heald, Oliver
Simpson, Keith (Mid-Norfolk)


Heathcoat-Amory, Rt Hon David
Soames, Nicholas


Howarth, Gerald (Aldershot)
Spelman, Mrs Caroline


Hunter, Andrew
Spicer, Sir Michael


Jack, Rt Hon Michael
Spring, Richard


Jenkin, Bernard
Stanley, Rt Hon Sir John


Johnson Smith,
Swayne, Desmond


Rt Hon Sir Geoffrey
Syms, Robert


Key, Robert
Tapsell, Sir Peter


Kirkbride, Miss Julie
Taylor, Ian (Esher & Walton)


Laing, Mrs Eleanor
Taylor, Sir Teddy


Lansley, Andrew
Tredinnick, David


Leigh, Edward
Trend, Michael


Letwin, Oliver
Viggers, Peter


Lidington, David
Walter, Robert


Lloyd, Rt Hon Sir Peter (Fareham)
Wardle, Charles


Loughton, Tim
Waterson, Nigel


Luff, Peter
Wells, Bowen


MacGregor, Rt Hon John
Whitney, Sir Raymond


McIntosh, Miss Anne
Whittingdale, John


MacKay, Rt Hon Andrew
Widdecombe, Rt Hon Miss Ann


Maclean, Rt Hon David
Wilkinson, John


McLoughlin, Patrick
Willetts, David


Madel, Sir David
Wilshire, David


Malins, Humfrey
Winterton, Mrs Ann (Congleton)


Maples, John
Winterton, Nicholas (Macclesfield)


Mates, Michael
Woodward, Shaun


Maude, Rt Hon Francis
Yeo, Tim


Mawhinney, Rt Hon Sir Brain
Young, Rt Hon Sir George


May, Mrs Theresa
Tellers for the Noes:


Moss, Malcolm
Mr. John M. Taylor and


Nicholls, Patrick
Mr. Tim Collins.

Question accordingly agreed to.

Amendment in lieu of the Lords amendments agreed to.

DELEGATED LEGISLATION

Mr. Deputy Speaker (Mr. Michael J. Martin): With permission, I shall put together the motions relating to delegated legislation.

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

BROADCASTING

That the draft Channel 4 (Application of Excess Revenues) Order 1998, which was laid before this House on 19th October, be approved.

LEGAL AID AND ADVICE

That the draft Legal Advice and Assistance (Scope) (Amendment) Regulations 1998, which were laid before this House on 19th October, be approved.

CONTRACTING OUT

That the draft Contracting Out (Functions in Relation to Insurance) Order 1998, which was laid before this House on 22nd October, be approved.—[Mr. Jamieson.]

Question agreed to.

EUROPEAN COMMUNITY DOCUMENTS

Motion made, and Question put forthwith, pursuant to Standing Order No. 119(9) (European Standing Committees),

AGENDA 2000: FINANCIAL ASPECTS

That this House takes note of European Community Documents Nos. 7046/98, Commission Communication on the Establishment of a new Financial Perspective for the period 2000–2006; 7221/98, Commission report on the implementation of the Inter-institutional Agreement of 29th October 1993 on budgetary discipline and improvement of the budgetary procedure together with proposals for renewal; 9302/98, the European Court of Auditors Special Report No. 6/98 on the Court's assessment of the system of resources based on VAT and GNP; and 11666/98, Commission report on the operation of the Own Resources system; and supports the Government's efforts to maintain budget discipline in the Community and to ensure the fair financing of the EU, reflecting Member States' ability to pay.—[Mr. Jamieson.]

Question agreed to.

BUSINESS OF THE HOUSE

Ordered,
That, at the sitting on Tuesday 17th November, the Speaker shall put the questions necessary to dispose of proceedings on the Motions in the name of Margaret Beckett relating to Scrutiny of European Business not later than one and a half hours after the commencement of proceedings on the first such Motion, and such questions shall include the questions on any amendments selected by the Speaker which may then be moved.—[Mr. Jamieson.]

LIAISON COMMITTEE

Ordered,
That Mrs. Margaret Hodge be discharged from the Liaison Committee and Mr. Malcolm Wicks be added to the Committee.—[Mr. Jamieson.]

Salmon Farming (Scotland)

Motion made, and Question proposed, That this House do now adjourn.-[Mr. Jamieson.]

Mr. James Wallace: I am pleased to have the opportunity to raise on the Adjournment of the House the subject of the Scottish salmon farming industry. I am very pleased that the Under-Secretary of State for Scotland, the hon. Member for Western Isles (Mr. Macdonald), who is Minister with responsibility for the highlands and islands, is present to reply to the debate because, between our two constituencies, we supply a substantial proportion of Scottish-produced farmed salmon.
The debate is an opportunity to emphasise the importance of the industry to Scotland as a whole, and to the highlands and islands in particular. In spite of many adversities confronting the industry, it has been one of Scotland's economic success stories. A recent Scottish Office and Highlands and Islands Enterprise survey shows that about 6,500 jobs in Scotland depend on the salmon farming industry—about 2,000 on farms and another 4,500 jobs upstream or downstream, in such industries as feed, supply and repair of cages and, obviously, the important salmon processing industry. The salmon farming industry has a turnover of about £260 million, and I am sure that the Minister would readily acknowledge that it is an industry that creates and sustains employment in many parts of the highlands and islands where there are no alternative forms of employment available. The industry is very important, so it is important that the House has an opportunity—albeit late in the evening—to discuss it.
The industry has not had to look far to find troubles and adversity. Those of us who have been in the House for some years remember the cyclical nature of the market and how, at this time of almost every other year, in the period leading up to Christmas—one of the busiest times for the salmon farming industry—there was a crisis, amidst allegations that the Norwegians were dumping cheap salmon on the European market.
Eventually, the allegations of dumping by the Norwegians were referred to and investigated by the European Commission, and the claims were held to be well established. That led to a negotiated agreement between the European Union and Norway, which effectively imposed a minimum import price—not a quota, which many in the salmon farming industry had wanted. There were mixed views at the time about how effective the minimum import price would be. I spoke to one producer today who said that its existence prevented a free fall in the price earlier this year, for which he was thankful.
This is probably the first opportunity that the House has had to hear from a Minister about the Government's assessment of the effectiveness of the regime and the agreement reached between the European Union and Norway in May last year. Under that, there are individual agreements between the EU and a number of Norwegian exporters. It is possible for the EU to take action against those breaching the rules, including the imposition of a tariff on exports to the EU.
On 31 August this year, there was a report in The Herald quoting the Official Journal of the European Communities, which identified three violations of the

agreement. As I have informed the Minister, there have been recent reports in Norwegian newspapers of Norwegian exporters coming to arrangements with Danish importers to try legally to circumvent the rules. Information on those allegations has been given by the Scottish Salmon Growers Association to the Commission.
I hope that the Minister will not only provide the Government's assessment of the effectiveness of the agreement reached last year, but will tell us what the Government do to monitor the effectiveness of the arrangements. Can he reassure the House that at all times, particularly in the light of the most recent allegations, they will press the Commission to monitor the situation and take effective action where any breach of the agreement is found?
I understand that import prices are to be averaged out over a quarter, and that they must average at the minimum import price or above. The last quarter of this year has started in October and the early weeks of November with volumes from Norway reducing the price well below the minimum import price. Doubts are being expressed whether between now and 31 December, prices can be sufficiently above the MIP to average at the MIP or above. What sanction will there be if, come February, it is found that the average price for this quarter—which is one of the most important times for the industry—was below the minimum import price?
The Norwegian Government undertook some self-restraint with respect to feed quotas. They announced for this year an increase in feed quota of 2.3 per cent., whereas the volume sold is up by 12 per cent. In spite of a weak market in Europe and the problems of the markets in Norway and Japan, a 10 per cent. increase is proposed by the Norwegian Government for 1999. That would lead to a substantially bigger volume coming on to the market. What representations have the Government made to the Norwegian Government about such an increase in their feed quota?
The MIP was fixed in May last year in ecus. At that time, the value was £2.75 per kilogram, whereas it is now £2.25 per kilogram. The strength of the pound has therefore led to a 20 per cent. loss of revenue for salmon producers. Do the Government intend to seek a revaluation or a change in the minimum import price to reflect the loss of value in real terms because of the strength of the pound in the intervening 18 months?
One of the other difficulties facing the industry has been the outbreak of infectious salmon anaemia—ISA. That was first reported in the west of Scotland in May. There was a confirmed case in Shetland in August. Can the Minister tell the House how many cases have been confirmed and when the last one was confirmed? There is a perception that the disease has been brought under control, but one hopes that one is not speaking too soon. An update would be useful.

Mrs. Ray Michie: My hon. and learned Friend is aware that in my constituency, salmon farming is extremely important. A number of producers have had to destroy all their stock because of ISA. Does he agree that the Government could give some help and restore confidence to the industry if they examined the


1993 EC legislation which provides for a 50 per cent. contribution to the cost of compensation, particularly for the smaller independent fish farms?

Mr. Wallace: My hon. Friend makes an important point about compensation. There has been a huge loss to the industry as a result of having to slaughter stocks. Indeed, there has been the immediate slaughter of stocks because ISA is a so-called list I disease. I want to emphasise—I hope that the Minister will do so as well—that there is no evidence that the virus associated with ISA has any effect on humans and that there is no risk to human consumption. Nevertheless, it has a pernicious effect on the fish and has led to slaughter. This has meant that producers have been faced with huge losses. Undoubtedly, claims for compensation are inevitable.
Earlier this year in the Court of Session, following an outbreak of viral haemorrhagic septicaemia on the island of Gigha in the constituency of my hon. Friend the Member for Argyll and Bute (Mrs. Michie)—a list 2 disease—it was found that the failure by the Secretary of State to provide for payment of any compensation where slaughter orders were made was illegal. I know that that outbreak can be distinguished because it involved a list 2 disease, but it is an important point that the fish were slaughtered on the orders of the Scottish Office. In the circumstances, the case for some element of compensation is strong.
Looking to the future in terms of insurance and compensation, it is obvious that there is a need to attract insurers into the market. As someone put it to me, "You will not get someone to insure a house when it is on fire." It is important that the problem is brought under control and eradicated. It is important also that those who are engaged in insurance see the problem as an insurable risk.
My understanding is that the industry has indicated a willingness to work with the Government and to make a contribution towards future insurance and compensation packages. However, the Government must shoulder their share of responsibility and likewise indicate a willingness to make a contribution. A joint Government and industry working group has been considering how interim cover arrangements can be put in place until such time as the disease becomes an insurable risk. That has happened in Norway and it is now possible to insure against ISA at affordable premiums. Is the Minister able to report on the progress of the joint Government and industry working group? Does he accept that in such situations, the Government have a role to play in shouldering some of the burden until it is commercially viable for insurers to offer insurance and for the industry to be able to afford the premiums?
That development in turn will require the consideration of some technical measures. In Norway, ISA is an insurable risk, but there has not been total eradication. However, the number of outbreaks has been reduced to such a low level that the insurers have been persuaded that it is a market in which they can become involved. There must be a good understanding of the technical and scientific issues that are involved. How, for example, did ISA get to Scottish waters? How does it spread? What is being done—perhaps the Minister can tell us—to advance technical and scientific knowledge of this disease?
Will the Minister think about more flexibility? I understand that under European Union rules, the fish have had to be slaughtered immediately. That means that a substantial volume has been slaughtered in a relatively few weeks whereas in Norway, it has been possible, when outbreaks have occurred, to slaughter over a period of months. That means also that there has been a more managed eradication which has had less impact on the market. As the fish have been slaughtered immediately here, there is no opportunity to mitigate loss through allowing for further growth. That makes insurance a less attractive proposition.
Many small producers who have not been affected directly by ISA in their own salmon farms have felt the effect of the disease because salmon that has been slaughtered has been put on the market in substantial volumes, which has driven the price down. This has meant that there has been a requirement by banks for many smaller producers to advance more collateral against borrowings. That has put great pressure on smaller producers and obviously inhibits the development of the industry. For these reasons, we want to be reassured on the technical measures that the Government are pursuing to try to ensure that there is a better understanding of the disease and that it can be contained in future.
Another issue that arises from ISA is the substantial investment—some £1 million—that was required in Shetland to install at very short notice blood water treatment equipment at salmon processing plants. The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food, the hon. Member for Scunthorpe (Mr. Morley), was in my constituency earlier this month and received some representations on that matter. I know that his visit was much appreciated.
Those arrangements had to be implemented swiftly, and financial instruments for fisheries guidance grant applications have now been made. I do not expect the Minister to tell me this evening that they will be successful, but I urge him to look on them favourably and sympathetically because they respond to an immediate problem and are an investment in the industry's future.
The industry welcomes the transfer of responsibility for planning arrangements from the Crown Estate Commissioners to local authorities. In Shetland and parts of Orkney, works licences are already issued by local authorities, but new arrangements would have to be made in the highlands, Argyll and Bute and the Western Isles. Local authorities will need to pool their resources because the number of applications will be relatively small and each local authority could not be expected to have its own marine expert. Some certainty is required about the transfer time and the arrangements that will be made in the interim, because primary legislation will be needed and that might have to await the Scottish Parliament. Clearly, salmon farmers wishing to develop, expand or set up new sites need to know the position in the meantime. Guidance on that from the Minister this evening would be welcome.
On the bureaucracy faced by the industry, I am advised that the Veterinary Medicines Directorate is slow in processing licensed medicines for salmon. While Norway has eight licensed sea lice treatments, the United Kingdom has only one and a half. I queried how we manage to have a half and was told that hydrogen peroxide cannot be used in the summer because of water temperature, so it is available for only six months of the year. The Ministry


does not seem to have enough push to deal with those matters within the European Union. The industry would welcome some assistance on that front.
In conclusion, we cannot underestimate the important role of salmon farming and agriculture in rural development. There are short-term problems, but also long-term opportunities. In the future, there will be a global demand for agricultural products. Scotland's assets include natural resources; a human skills base—many jobs now have increasingly skilled components; niche marketing skills; proximity and access to European markets; a strong domestic market, with an 11 per cent. increase to September this year; and an end product that commands consumer support. Although the industry has had some development grants, it has reached its present state without subsidy. It wants to ensure that it is up to date and takes on the best in terms of environmental assessment and environmental management systems. Westray and Hoy in Orkney now have organic salmon farms. Thus the industry is taking a long-term view and it wants reassurance tonight that the Government support it.
This may be the last time that the House of Commons debates the Scottish salmon farming industry, because next July responsibility for it will transfer to the Scottish Parliament. That Parliament will recognise an industry that is important for Scotland and offers great opportunity for development in Scotland. This evening, we want some support and reassurance that the Government will help to see it through its current difficult times.

The Parliamentary Under-Secretary of State for Scotland (Mr. Calum Macdonald): I congratulate the hon. and learned Member for Orkney and Shetland (Mr. Wallace) on securing this debate. I entirely agree with him about the industry's importance to Scotland, particularly its most fragile and remote areas. I welcome the participation of the hon. Member for Argyll and Bute (Mrs. Michie) in the debate.
The hon. and learned Gentleman made a number of points and I should like to get through as many as I can. On the agreement between the European Union and Norway, it is a measure of our commitment to the industry that one of the first things that the Government did last year—led by my right hon. Friend the Secretary of State for Scotland and my noble Friend Lord Sewel—was to intercede with the European Commission in the action initiated by the Scottish industry against its Norwegian counterpart for dumping farmed salmon on the Community market.
It is well known that we did not think that the action agreed by the EU went far enough—as the hon. and learned Gentleman said, it received a mixed reception—but, to its credit, the Commission has taken its responsibilities for monitoring and enforcing the agreement with the Norwegians seriously. The result has been that the Commission has imposed duties on 36 companies. A further three face a similar prospect, and, as a result of EU pressure through the agreement, the number of companies registered to trade has been reduced from 191 to 135.
As the hon. and learned Gentleman knows, the main aim of the agreement is to introduce a degree of stability in the salmon market. That involves imposing a minimum import price for salmon exported from Norway to the EU;

requiring Norwegian exporters to register and exposing them to tariffs if they breach those prices; and requiring that part of the export tax imposed by the Norwegian authorities to be used for generic marketing of Atlantic salmon. The latter has taken time to settle and to organise, but I understand that a way ahead has been agreed, involving the industries of Scotland, Norway and Ireland. Today, a £4 million advertising campaign, funded by that export tax, has started in France, Germany and Spain.
Earlier this year there were signs that, at long last, the agreement was beginning to have the desired effect. Prices began to rise, offering Scottish growers some long-overdue promise of better times, but they dipped a few months ago, when the Norwegians placed sizeable quantities of small fish on the market. That was made worse by similar placements as a result of infectious salmon anaemia outbreaks in this country. We look to the price drop being reversed as the Christmas trade approaches.
The hon. and learned Gentleman mentioned the report of Norwegian producers using Denmark to get around the regulations. We were not aware of that, but we will investigate, contact the Scottish Salmon Growers Association and pursue the matter with the Commission. He also mentioned the impact of the pound on the agreement. It is up to the EU to renegotiate the agreement, but it is important to bear in mind that sterling has fallen against the deutschmark by 10 per cent. in the past year.
As the hon. and learned Gentleman made clear, ISA is a matter of concern. I agree with him that there is no evidence that the disease has any effect on human health. It was first confirmed at a farm on Loch Nevis on 15 May this year and since then there has been confirmation on 10 farms, including one in the hon. and learned Gentleman's constituency. The common denominator appears to be site-to-site contact, although the source is still a mystery. It is being investigated.
A further 11 farms are suspected of having the disease, including one on Shetland which has been cleared of its fish. As a consequence of all that, movement restrictions have been imposed over a wide area and 198 farms are currently affected. The last known incident was in September and I share the hon. and learned Gentleman's hope that the disease might have run its course.
ISA is classified as a list 1 disease under EU legislation, which requires that eradication action must be taken when the disease is confirmed. That entails a number of procedures, and fallowing of the sites for at least six months before restocking. Movement restrictions have been imposed over a wide area and a rigorous inspection regime is under way. This is the first time that anyone in the EU has experienced the disease and it is almost inevitable that our processes for handling it are being developed as time goes on. I stress, however, that we are in close contact with the Commission, which has expressed itself satisfied with the steps that we are taking.
I am conscious that the ISA outbreak is causing hardship, and that things could get worse if the suspected sites are confirmed or if outbreaks occur elsewhere. Already, there have been redundancies, and I am aware of the considerable concern that the disease should be contained.
I pay tribute to those in Shetland who have had to deal with the consequences of the outbreak. That response has been positive, and it has been recognised that without such


action others could face a similar plight. I particularly want to pay tribute to Shetland Islands council, which has made available some £100,000 for disinfection of liquid effluent from salmon processors. I am also grateful to Shetland Enterprise for its £50,000 contribution towards that work, which is vital if reinfection is to be avoided.
The hon. and learned Gentleman said that producers have made an application for FIFG support. It is available into next year, but it is as well that they have put in their applications, because the last date for doing so is 31 December. Most of the £5 million—£4.1 million of it—allocated to FIFG has already been awarded, so there is pressure on resources. The final round will be allocated early next year.
It is now almost two months since the last outbreak was confirmed. I know that everyone in the industry shares the hon. and learned Gentleman's hope that we are past the worst.
The problem of disposing of slaughtered fish in a small place such as Shetland could be severe. Thus far we have received considerable support from the Norwegian authorities in handling waste from infected farms, and we are grateful to them for that. We are exploring alternative arrangements should the need arise in the future.
It is precisely because of those problems that rigorous controls are being enforced. The total co-operation of all concerned is absolutely vital. As I said earlier, we are all learning lessons about the disease as time goes on. In the light of experience gained, we have introduced a graduated approach to the fallowing of sites within restricted zones, which reflects the disease risk in each case. It is important for all concerned to recognise and accept that we cannot cut corners.
The hon. and learned Gentleman spoke about the need for fish farmers to be encouraged to report disease early on. He suggested that a compensation scheme could be beneficial and that its application should be considered more widely. The industry has so far shown a responsible attitude, and I very much hope and expect that to continue, regardless of the compensation issue.
I assure the hon. and learned Gentleman that we are continuing to discuss all the options. However, it would be less than frank of me not to mention the fact that it has not been the policy of successive Governments to pay compensation for fish diseases. Indeed, we do not have the legislative competence, as the hon. and learned Gentleman knows from incidents of shellfish poisoning in his constituency. Equally, it is important to recognise that the issue is not simply one for the taxpayer; we need to

explore the scope for the industry to recognise its obligation to address the financial consequences of the disease.
The hon. and learned Gentleman mentioned Gigha. In that case, the disease was viral haemorrhagic septicaemia, which is a list 2 disease for which the rules are different. A judgment in that case is the subject of an appeal, so I cannot comment on it further.
As for the hon. and learned Gentleman's point about medicines, I recognise the industry's concern that it is being denied the use of treatments available to Norwegian competitors. The use of medicines is a sensitive issue. Statutory procedures are laid down and must be observed. Nevertheless, we are conscious of the view that such treatments could overcome a number of problems, and I assure the hon. and learned Gentleman that we shall continue to seek to ensure that applications receive speedy attention.
The hon. and learned Gentleman also spoke about local authority involvement in the approval of fish farm developments. That reflects the Government's decision, after full consultation, that, subject to endorsement by the Scottish Parliament, local authorities should have formal planning responsibilities. We believe that outcome to be the right one: the issue is for local communities to decide, and they should have a say in the matter. There were many complaints in the past about the way in which the Crown Estate Commissioners handled the matter, and about the fact that local communities did not have a direct, democratic say.
To help in the process of consideration we have done what the hon. and learned Gentleman suggested, and issued draft locational guidance. Advice on environmental assessments, commissioned by the Crown Estate and the industry, has also been produced. Consistency across authorities is never guaranteed; but then it does not apply in other planning areas, and that is right in principle. Different areas have different priorities. The point to recognise is that, in addition to central guidelines for local authorities, there will be a formal right of appeal for applicants.
It is always difficult to respond to all the points in a debate such as this. If I have missed any out, perhaps hon. Members will bring them to my attention, and I will respond in writing. I congratulate the hon. and learned Member for Orkney and Shetland on securing the debate, and on clearly articulating the concerns and desires of the industry at what is undoubtedly a difficult time. I assure the hon. and learned Gentleman and the industry that the Government remain firmly committed to a fully sustainable fish-farming sector.

Question put and agreed to.

Adjourned accordingly at ten minutes to Eleven o'clock.